Ether's liquidity thins despite strong Q3 price gains

Ether (ETH) outperformed bitcoin (BTC) in the third quarter of 2026, with a 70% price surge compared to bitcoin's 42% gain. Despite this strong performance, ether's liquidity shrank relative to bitcoin, according to a report by CoinGecko. Between July 6 and September 30, ether's median daily market depth was only 35% to 45% of bitcoin's, a significant drop from the at least 60% depth observed in the same period last year. CoinGecko described this as a 'stark drop from last year's figures.'

Market depth, which measures liquidity by the total dollar value of buy and sell orders close to the current price, is crucial for understanding how easily a token can be traded. Ether had $13 million to $14 million in depth within 0.15% of its market price, indicating a relatively thin market. While ether remains fairly liquid within this range, with most exchanges maintaining over $1 million in depth on each side, the overall thinning of liquidity challenges the common belief that rising prices attract more traders and deepen order books.

Solana (SOL), ether's main rival, also experienced a decline in liquidity. CoinGecko noted that SOL's depth within 2% of the market price fell from about $28 million on each side of the order book last year to around $20 million this year. This suggests that SOL's market has less capacity to absorb larger swings in trading pressure, which could affect its price stability during sharp rallies or sell-offs.

In contrast, XRP's liquidity was skewed bullish, with around $30 million in total depth. However, its order books leaned heavily toward buyers, with close to $18 million in bids against $14 million in asks. Despite XRP's market cap being about 40% larger than SOL's, it has less depth within 2% of the price, partly due to SOL trading 25% more on an average day.