These Key Factors Might Push Ethereum To Outplay Bitcoin
03 November 2022 - 06:38PM
NEWSBTC
Bitcoin, Ethereum, and the entire crypto market is often prone to
price fluctuations. That’s why crypto investors must carefully
monitor the market movement to avoid huge losses when prices are
low. The crypto bear market could also be a time for long-term
investors to leverage low prices and purchase assets which they can
sell during bull runs. However, the past months’ losses have been
nearly unbearable for investors as factors such as interest rate
hikes and inflations escalated the issues. Nevertheless, the crypto
market has recorded some relief in the past week as some assets saw
massive price rallies. Related Reading: Dogecoin (DOGE) Cracks Over
150% In 7 Days; Is The Top In Yet? Among the assets that performed
well is Ethereum, having seen over 9% gains in the past seven days.
Ethereum’s performance brought the total crypto market
capitalization back to the $1 trillion mark. Three Factors Driving
Ethereum Performance The rally started on October 25, with Ether
gaining 17%, while BTC only managed to add 6% over the same time.
Some analytics explained why Ethereum had such an outstanding
performance over Bitcoin. Grayscale, an institutional assets
manager, said Ethereum’s supply level after the merge might have
influenced the asset’s performance. ETH supply was so much before
the merge. But ETH issuance dropped after the merge to
approximately 14,000 ETH per day and less than 5 million per year.
Moreover, like BTC miners, Ethereum miners had to sell assets to
cover expenses during the long crypto winter. However, the
situation has improved after the proof-of-stake transition,
minimizing the selling pressure. Grayscale November report revealed
that the reduced selling pressure exposed the ETH price to more
positive upward movements. Ultrasound Money reported that Ethereum
supply growth is now only 0.09% per year. ETH supply switched to
deflationary growth many times in the past weeks. It happened when
the network ETH demand increased, leading to the burning of more
tokens than produced. Theoretically, ETH’s attractiveness as a
long-term asset has increased. Energy Consumption Rate And Ether
Price Outlook VS. Bitcoin Moreso, Ethereum energy consumption was
reduced by 99.9% post-merge, making the asset more environmentally
friendly. That has made ETH more appealing to environmental,
Social, and governance-conscious institutions. Digiconomist
Ethereum Energy Consumption Index revealed that the energy
consumption reduced from 84 TW/h per year to 0.01 TW/h after the
merge. The listed factors made Ethereum a better prospect for
investors than Bitcoin, reflecting on its recent performance.
Related Reading: On-Chain Data Suggests Bitcoin Bottom Comparable
To Previous Cycles Ethereum is currently trading at $1,552. Its
price jumped to $1,645 on October 29, the highest since the middle
of September. But it did not move higher, and it’s still 67.6% down
from its November 2021 all-time high. ETH gained 24% in the past
month but still range-bound like it’s been since May. This number
is somewhat better than Bitcoin’s price decline. Bitcoin dropped
more than 70% from its November 2021 all-time high. Currently,
Bitcoin is trading at $20,300. Its market dominance is now 38.77%,
and a total capitalization of $393 billion. Featured image from
Pixabay and chart from TradingView.com
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