Bitcoin is up more than 600 percent over the last year, making it the most talked about coin – and likely the most talked about asset – amongst traders. Everyone acknowledges it as the number one digital currency by market cap, and it has recently crossed the $1 trillion threshold. At this stage, anyone who hasn’t heard of bitcoin is likely living under a rock, but many analysts still believe that Ethereum could potentially overtake the asset as the number one coin in the crypto trading space.
Bitcoin or Ethereum? Analysts Go Back and Forth
While bitcoin may have an impressive price and is doing well as a hedge tool and speculative asset, Ethereum, as industry heads argue, has more use that bitcoin in the sense that it offers smart contract capabilities and can lead to the development of future coins and decentralized applications. While its investors may not be viewing it under the same lens as bitcoin, they are likely thinking the currency has a serious future as a developmental tool.
Tally Greenberg – head of business development at Allnodes – broke the situation down in a recent interview and explained the benefits each token has going for it:
Bitcoin is the asset of choice for investors looking for store of value investment characteristics in the cryptocurrency market. Success then is an ongoing price appreciation for this asset and appreciate it will so long as investors continue to believe in the future of blockchain and cryptocurrencies. Ethereum, on the other hand, is not only a cryptocurrency. It is a network that supports smart contracts, dapps (decentralized applications), and defi (decentralized finance) projects. Investors that are looking to invest in up-and-coming tech should pay extra attention to this crypto asset. Over $41 billion is currently locked in defi projects on the Ethereum blockchain compared with $4 billion eight months ago. That’s what success continues to look like for Ethereum this year as well – ongoing expansion and innovation.
Some of these analysts – such as Jason Peckham at Invictus Capital – believe bitcoin is always likely to reign supreme, commenting:
BTC is unlikely to be dethroned as the leading cryptocurrency, but the growth shown on the Ethereum blockchain is hard to bet against. They will naturally be compared ‘against’ one another although this makes little sense from a functional point of view since each is vying for separate and mutually beneficial use cases. BTC’s ‘digital gold’ narrative is straightforward, which is beneficial for attracting new users who may be intimidated by the apparently more complex and dynamically evolving ETH narrative.
Some Say the Altcoin Will Be King
For others – such as Noam Levenson of Narrow Straight Writing – Ethereum is likely to take over the crypto space. Levenson explains:
I think it’s highly likely that ETH will beat BTC in terms of price performance in 2021. Ethereum has not fully realized the benefit from the growing popularity of defi services and NFTs.