JPMorgan Lists Ethereum As A Better Investment Than Bitcoin
26 November 2021 - 4:00AM
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Ethereum has proved itself be to a force to be reckoned with and
big bank JPMorgan agrees. When it comes to performance, Ethereum
has outperformed rival Bitcoin, although the latter remains the
most valuable cryptocurrency in the space. However, if history is
any indication to go by, then Bitcoin may not be in the lead for
much longer. Analysts at JPMorgan recently released a report on
cryptocurrencies and their potential. Although the note
acknowledged the ability of Bitcoin, it also puts Ethereum ahead of
the leading cryptocurrency in coming years. The report based its
argument on the utility of both assets. While Bitcoin is good for
its monetary policy, Ethereum has proven to be even better. Related
Reading | Why This Crypto Billionaire Abandoned Ethereum
Invest In Ethereum The JPMorgan note outlined how Etheruem could
prove to be the better bet compared to Bitcoin in the long wrong.
Bitcoin may still be the most valuable cryptocurrency, but with
climbing interest rates, Ethereum could end up faring better. “The
rise in bond yields and the eventual normalization of monetary
policy is putting downward pressure on bitcoin as a form of digital
gold, the same way higher real yields have been putting downward
pressure on traditional gold,” said the analysts. ETH recovers
above $4,300 | Source: ETHUSD on TradingView.com This is because as
interest and inflation rates rise, more investors will flock
towards decentralized finance (DeFi) protocols, which offer more
attractive interest rates than traditional finance. Given that
majority of these DeFi protocols are built on the Ethereum
blockchain, it will only drive more adoption in the digital asset,
providing it more room to grow than Bitcoin. In the note, JPMorgan
also points to the budding NFT, gaming, and stable coins portion of
the market. This makes it a “safer” bet than Bitcoin when it comes
to investing in cryptocurrencies, which are infamous for their
volatility. As interest rates rise, its underlying utility should
be able to help it maintain its value, the note reads. “With
Ethereum deriving its value from its applications, ranging from
DeFi to gaming to NFTs and stablecoins, it appears less susceptible
than bitcoin to higher real yields.” Outperformance For The Future
Analysts at world-leading bank JPMorgan also put forward other
reasons that Ethereum could end up being a better investment option
than Bitcoin. One of these was the fact that the altcoin has
consistently outperformed Bitcoin year-over-year. The numbers for
2021 alone show a wide margin when both digital assets are compared
side by side in terms of performance. Related Reading | Reddit
User Calls Out KuCoin Over ≈$50,000 Stuck On Exchange Ethereum has
grown more than 500% in the year compared to Bitcoin’s 96%. If the
asset maintains this rate, then it could very well surpass the
market cap of Bitcoin in the next five years while returning higher
gains for its investors. In five years, Ethereum has grown to about
half the total market cap of Bitcoin. Sitting at over half a
trillion dollars, the digital asset surpassed giants like Visa,
MasterCard, and JPMorgan to claim the 15th spot as the most
valuable asset in the world. Featured image from Coingape, chart
from TradingView.com
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