Will Ethereum replace Bitcoin as the best asset of 2021?

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Even though Bitcoin has been dominating the crypto space due to its keep on soaring value, Ethereum may emerge as the choice for many users and institutional investors due to differences from Bitcoin’s store of value.

At the time of this writing, Ethereum stands at $1,723, just in the proximity of its ATH (all-time-high). Since March 2020, the second-largest cryptocurrency has grown 1,600% since March 2020 when the value of 1 ETH was less than $ 100. According to ycharts Ethereum’s market capitalization currently stands at around $200 billion.

The soaring demand of developers for continuing to utilize Ethereum blockchain is a testament to its value, according to Cointelegraph. Most of the cryptocurrencies were ERC-20 tokens built on Ethereum, despite new competitors coming to take the market away from the dominant blockchain.

The rapid rise in transactions also makes the bullish case for Ethereum. According to the publication, Ethereum facilitated over $1 trillion worth of transactions on the Ethereum blockchain.

Another scenario that makes a strong case for Ethereum is the rise of Decentralized finance or DeFi. Gaining a huge positive sentiment during late 2020 to a point that DeFi enjoyed a higher price among which YFI at one point even had a value than Bitcoin. At press time, the total value locked in DeFi stands at $69.01 billion, majority of which is locked in the Ethereum blockchain, according to DeFi Pulse. Cointelegraph stated in its report that even though most DeFi has given rise to a market that is free for all, it is highly likely that institutional investors may soon capitalize on it.

Currently, bitcoin is enjoying support from big firms even though the SEC still doesn’t hold a good opinion. Recently, the ability to trade bitcoin futures contracts enabled the crypto assets to integrate and be widely accepted in the investing community.

While bitcoin is also a decentralized network the room for innovation is much less when compared with Ethereum which operates as a decentralized network enabling developers to build applications. Furthermore, many cryptocurrency tokens are issued over the Ethereum network which is not the case with bitcoin.

Ethereum’s ability to fundamentally change the way mortgage transfers, securities trading and many other fields work has brought forth its capabilities.

One of the major differences between Bitcoin and Ethereum is how blocks are created. Here, the one with the largest owner of stakes has the advantage of creating new tokens as opposed to the miners with the highest computing power. This ability can be advantageous to institutional investors who want to play a key role in the creation of new tokens.

Though bitcoin is currently on the bull run, mainstream and stable among the two, the bullish sentiments amongst experts in the field have grown over the last few years.

Ethereum’s climb may just be the beginning; meaning that investing in Ethereum could lead to maximum financial reward and return on investment.


Will Ethereum replace Bitcoin as the best asset of 2021? was originally published in DataDrivenInvestor on Medium, where people are continuing the conversation by highlighting and responding to this story.