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Ether's bitcoin-beating Q3 rally came with a catch. Liquidity thinned
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- DeepHorus
Ether beat bitcoin in the third quarter, rising 70% against bitcoin’s 42%, but CoinGecko reported thinner liquidity. Between July 6 and Sept. 30, ether’s median daily market depth was 35% to 45% of bitcoin’s. That gap could make large orders move ether’s price more sharply.
Market depth measures the dollar value of orders within a set distance of the current price. Ether had $13 million to $14 million within 0.15% of market. A year earlier, its relative depth was at least 60% of bitcoin’s.
CoinGecko called the change “a stark drop from last year’s figures.” The data challenge the idea that rising prices automatically attract traders and deepen order books. Thin liquidity can make a large order consume nearby orders, increasing execution risk.
Ether remained fairly liquid in the measured range, with most exchanges holding more than $1 million on each side. Routine trades remained possible, but the buffer for larger orders was smaller than bitcoin’s. CoinGecko also found thinner liquidity in other major tokens.
Solana’s SOL also lost liquidity, measured within 2% of market price. Depth on each side fell from about $28 million last year to $20 million this year, reducing capacity to absorb larger swings. The wider range makes SOL’s figures distinct from ether’s 0.15% measure.
XRP, the payments-focused cryptocurrency, held total depth near $30 million, but its book leaned toward buyers. About $18 million in bids compared with $14 million in asks. SOL traded 25% more than XRP daily, despite XRP’s market cap being about 40% larger.
The findings suggest that ether’s rally produced strong returns without a matching improvement in market resilience. Traders could face greater slippage during volatile periods, while market makers may need to manage liquidity cautiously. Whether the thinner book persists will shape confidence in future rallies.
