Ether delivered stronger returns than bitcoin in the third quarter, but the gains came with a notable drawback: the token's market liquidity contracted relative to its larger rival.
Between July 6 and September 30, ether's median daily market depth was just 35% to 45% of bitcoin's, down from at least 60% in the same period last year, according to a CoinGecko report. Market depth measures liquidity by tracking the total dollar value of buy and sell orders on exchanges within a set distance of the current price.
Ether's price surged 70% during Q3, outpacing bitcoin's 42% gain. Yet despite the rally, the token had only $13 million to $14 million in depth within 0.15% of its market price—a measure of how easily large trades can be executed near the current price without significant market movement.
This pattern defies a common market assumption that rising prices attract more traders and deepen order books. CoinGecko noted the decline was "a stark drop from last year's figures."
Ether remains reasonably tradeable, with most exchanges maintaining over $1 million in depth on each side at the measured range, but the thinning liquidity underscores constraints on market depth despite price appreciation.
Broader Liquidity Pressures Across Altcoins
Solana, another major cryptocurrency and rival to ether, also experienced shrinking liquidity. SOL's depth within 2% of the market price fell from approximately $28 million on each side last year to around $20 million in the current period.
XRP maintained relatively steady depth around $30 million in total, though its order book showed a bullish tilt during the study period, with roughly $18 million in bids against $14 million in asks. Despite having a market cap about 40% larger than SOL's, XRP has less depth within 2% of the price because SOL trades about 25% more frequently on an average day.
