Is Ethereum a new favorite on the crypto market?
This blog post will cover:
Lately, the Crypto World dove into a new intrigue. After the new Ethereum upgrade, known as the Berlin upgrade, the ETH price has started to increase. This is the first time in crypto history when it seems that we are witnessing a fight for leadership between two famous cryptocurrencies. Experts are discussing different reasons why Ethereum can suddenly become more powerful than Bitcoin. To understand the premises for this phenomenon we need to comprehend the difference between two coins.
Bitcoin appeared in 2009. It was created by a mysterious person, known as Satoshi Nakamoto. The main purpose of Bitcoin is to become a medium of exchange and a store of value. It brought a promise of an alternative decentralized currency. These peculiarities of Bitcoin became super relevant in 2020. During the pandemic followed by the economic crisis, we saw an increase in BTC purchases all around the world. Trying to protect savings people were investing actively in the system that was not supposed to go with the existing economic trend. That once again emphasized the goal of BTC.
The other important moment is speed. Bitcoin processes about 4.6 transactions per second, which is not very much. The higher the speed of transactions the easier it is to use coins as a means of payment. With BTC it takes time to complete transactions.
Ethereum was launched in 2015. Vitalik Buterin, a key person behind the idea, is well-known. Ethereum is a decentralized open-sourced blockchain system. It allows users to create applications based on smart contracts. The main goal of this project is to become a global platform for decentralized apps. We can see that each upgrade brings new features that help developers to be more effective while using this blockchain. The Ethereum system has its inner currency, ETH. What about transactions? Ethereum shows about 659,000 transactions per day. This speed is significantly higher than Bitcoin has. Apart from the demand, it is connected to the speed with which blocks are added to the blockchain. Since the speed is rather high, it is more delightful to use ETH for payments.
It is obvious that Ethereum and Bitcoin are two absolutely different projects. It starts with their aims and is followed by their technical inequality. In theory, they serve different purposes and should not compete at all. In practice, we see that the popularity of ETH is growing and it affects the situation.
Some analysts suggest that the main reason for changing leadership may be the shift of focus. Now people see more potential in the coin that can actually be used in a number of applications, rather than in something that can be turned into long-term investments. And the amount of these apps is growing rapidly. The more people come into crypto the more utilitarian it becomes.
It is important to remember that the Crypto World is very young and is changing rapidly. We cannot predict the future of any coins. However, we can witness how new people coming into the industry are shaping it.
SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.