(Newswire.net — June 24, 2021) — Both Bitcoin and Ethereum started the year with a great price rally that shoots both currencies to a new all-time high and acceptability. But after a couple of months, both of them are now falling sharply from their peak. Bitcoin price has lost a third of its value since it almost hit $65,000 in April while the Ethereum price has also crashed by almost 50% from its mid-May high.
Considering how Ethereum’s rally has dwarfed the bitcoin price surge over the last 12 months, increasing by 1,612% compared to Bitcoin’s 418% rally, people have been asking perhaps we are close to the time to witness Ethereum overtaking the almighty crypto: Bitcoin.
Ethereum’s progress has been seen both in the value of the Ether cryptocurrency and other applications that can be developed on the blockchain. Nathan Cox, the chief investment officer of the $100 million digital assets, Two Prime forecasts that with the way Ethereum is growing, it will eventually “flip” Bitcoin. He said, “It’s just now starting to be understood by the second-tier adopters. Ethereum’s utility alone will outstrip anything else.”
Todd Morley, the co-founder and former executive of investment giant Guggenheim Partners, who’s become a crypto and blockchain investor and entrepreneur, has also said that he thinks Ethereum has “much higher utility” than Bitcoin – and is “where the action is.”
So if most people are with the belief that the second-largest cryptocurrency, Ethereum, could flip Bitcoin in the future, what could be some reasons for that? Let’s take a look at some of Ethereum’s unique features and growth that could put the crypto in the position to outrun the leading Bitcoin.
Ether Has More Use Than Bitcoin
One basic thing that made Bitcoin and many other digital-native assets stand out from legacy digital payment methods, such as PayPal and Visa, is the ability to remove all middlemen from transactions. No one authority or legal institution is involved in those transactions, so no one can stop or pause any transaction you make through the system. That is why they are called decentralized systems.
However, unlike Bitcoin, Ethereum does a lot more than just enabling peer-to-peer transactions. Think of Bitcoin as digital gold and Ether as digital oil. One is used as a payment method or a way to store wealth (Bitcoin), while the other was created to function like digital oil that helps to power and enable the applications that run on the Ethereum network (Ether).
Ethereum is able to host thousands of blockchain-based solutions, including most decentralized apps (Dapps). That is one thing you can’t get with the Bitcoin blockchain. Therefore, we can simply put it that Ethereum expands the use of blockchain from simple value transfer (like Bitcoin) to more complex use cases.
Smart Contracts
Unlike Bitcoin’s blockchain, Ethereum’s blockchain enables developers to create more sophisticated programs on its blockchain. These programs are basically referred to as “smart contracts.”
A smart contract is usually used to refer to a set of rules that say when one thing happens, this will then trigger something else to happen automatically. Think of it as a vending machine. When you pop a coin into the machine, it automatically delivers the items you want.
With smart contracts, you just pop a cryptocurrency into the vending machine (the blockchain ledger), and you automatically get your legal contract, driver’s license, or whatever you have agreed to get. Smart contracts can help exchange money, property, shares, or anything valuable in a transparent, conflict-free, and peer-to-peer way to avoid needing the service of a middleman.
That is one thing you can’t get from Bitcoin’s blockchain. And that is one of the unique features of Ethereum, helping to contribute to its steady growth.
Non-Fungible Tokens (NFTs)
Ehthereum’s versatility has earned it the nickname ‘world computer’ because of its potential to decentralize the whole internet and transform the way we transfer everything, from online data to the property deeds of a house.
An excellent example of this development is the recent trend of non-fungible tokens, where digital artwork is sold, transferred, and stored on the blockchain, which is largely powered by Ethereum. This is a great function within the Ethereum network that contributes well to the considerable price gain of Ethereum in recent months.
Decentralized Finance (DeFi)
Aside from being used as a form of payments, the Ethereum blockchain also has more uses, such as hosting NFTs (as stated above) and trading DeFi. Decentralized finance is presently a focal point in the recent crypto bull run. It is a big thing at the moment.
The DeFi movement refers to a brand new monetary system that is built on public blockchains. On a daily basis, DeFi continues to grow in acceptability. Back in June 2020, just about $1 billion was locked up in DeFi smart contracts. But by April 2021, users have poured over $69 billion worth of cryptocurrencies into DeFi smart contracts.
Banks and other financial institutions work as a middleman in transactions. But DeFi comes to remove the need for that, so no one is taking a cut of the transactions you perform. Using software and behavioral incentives and rewards, DeFi is able to cut out any middleman and automate the entire end-to-end system.
With all these amazing and endless possibilities offered by Ether, one will quickly understand why analysts and investors predict that when it comes to Ethereum overtaking Bitcoin, it is not a question of if but when.
Bitcoin may be the fastest asset in history to get a total value of more than $1 trillion in just 12 years; with Ethereum presently valued at 38% of Bitcoin’s value (from only 19% last year), Ethereum may achieve the same mark in less than 8 years.
Is It Wise To Invest In Ethereum Right Now?
Well, the crypto market is a highly volatile one. Price can shift in any direction and at any time. However, considering the recent growth and moves of Ethereum in the last few years, one will agree that investing in cryptocurrency will likely not lead the wrong way. But make sure you do your own research before investing in any cryptocurrency, and don’t do more than you can safely lose.
With all the present hype surrounding Ethereum right now, you may also be considering adding Ether to your portfolio. You can buy from any trusted online exchange, such as Binance, Coinbase, or AnyCoin Direct to get started.
Take a step now and join the sweet Ethereum movement!