In the second half of 2020, we saw increased interest in cryptocurrencies from institutional and large-cap investors. However, all of Pisces’ attention, like all of the audience’s attention, was directed towards Bitcoin (BTC). Today we will look at why ether is a more attractive resource and why this cryptocurrency should become the “number one cryptocurrency” for every investor.
Let’s start with the numbers: ETH’s growth from its low in March 2020 after the market crash caused by the coronavirus reached 1200%, while BTC grew by only about 700%. ETH gained 1200% from its lows in March 2020 after the market crash caused by the coronavirus, while BTC only gained about 700%. Of course, given Bitcoin’s record highs of $ 40,000, Ether’s $ 1,400 rally doesn’t look impressive. Moreover, the market cap of ETH is five times less than the market size of BTC. But what is most important for an investor: good numbers and an overview of a portfolio or an asset with a high income?
There are very good reasons to believe that Ether will continue to rise in value in 2021 and bring more returns to investors than the “most popular cryptocurrency,” Bitcoin.
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Demand among developers
Ethereum is the leading platform for building blockchain projects and launching decentralized applications. The chart below shows the number of unique ERC-20 tokens in circulation in the early years since the launch of the Ethereum network. And while the pace of market expansion for newly launched blocks has slowed after the initial coin supply bubble burst in 2018, the total continues to rise.
And despite the fact that Ethereum has serious competitors such as Tron, Polkadot, Cardano, Cosmos and Tezos, Vitalik Buterin’s cryptocurrency platform is still a pioneer in this direction.
Increase your transaction volume
Over $ 1 trillion in transactions were recorded on the Ethereum blockchain during 2020. These numbers exceed the transaction volume of payment giants such as PayPal, which are used by more than 350 million users and have average volumes that usually do not exceed $ 200 billion per quarter.
Also keep in mind that each transaction generates network fees that are paid in ETH. As the network growth rates remain high, we can safely expect the continuation of the “bullish” trend for ETH. In any case, interest in cryptocurrencies is growing, as is the number of active wallets, the number of transactions on the network and the average volume of transactions.
Development of the DeFi sector
Despite Bitcoin’s leadership in the cryptocurrency market, Ethereum continues to be a leader in the young decentralized financial industry. DeFi credit and equity projects are hugely popular in the summer of 2020, and they continue to grow and attract new investment.
On the subject: Was 2020 “the year of DeFi” and what is expected from the sector in 2021? Experts answer
The total cost of decentralized finance has grown by nearly 3,300% since the beginning of 2020, from $ 687 million to $ 23.2 billion. Ethereum is the most important platform for creating and launching most new DeFi and stablecoin businesses.
The release of stablecoins is growing steadily, as digital assets, backed by the value of fiat currencies with less volatility, are a very practical tool for making quick decisions by users, for forming trading pairs on cryptocurrency exchanges and saving capital from high volatility in a cryptocurrency portfolio. …
Separately, it should be said about the interest of institutional investors in decentralized finance. While the chaos in the DeFi market in the summer of 2020 nearly eroded institutional confidence in the potential of blockchain in the financial sector, public corporations continue to show interest in a new type of asset.
In August 2020, Archax and Algorand announced plans to develop tools for implementing DeFi in enterprises. And in the fall of 2020, it became known that xSigma, a subsidiary of ZK International, traded on the Nasdaq exchange, is developing DeFi services and preparing to launch a decentralized exchange for trading coins.
We all remember what led to a lot of investor interest in bitcoin last year, right? Now, it looks like other areas of the cryptocurrency industry are looking for the same, some of which are directly related to Ethereum. Ethereum’s biggest advantage lies in the variety of technologies and its growing community.