Is Ethereum Catching Up to Bitcoin?
People are always going to pair the best with a contender, whether that be in works of art, sports, or, yes, cryptocurrency.
Since Bitcoin (BTC) was created, it has absolutely dominated the cryptocurrency market—leading in price and market capitalization. However, (ETH) has since made a push, consistently sitting at the number two spot right behind BTC.
The question that many people are asking now is: is Ethereum catching up to Bitcoin? Let’s break it down.
Their key differences
Before we answer the main question, let’s first break down what each crypto is, what they’re used for, and how they’re obtained.
Bitcoin is widely regarded as the first-ever cryptocurrency, created by Satoshi Nakamoto back in January 2009. Ultimately, the goal of BTC was to solve the double-spending problem that the digital cash schemes at the time had. Since then, it has evolved into something completely revolutionary. It has now developed many real-use cases such as a more efficient means of remittance, transaction, store of wealth, and more.
Ethereum, on the other hand, was introduced to the world in 2015 by young Russian-Canadian Vitalik Buterin. Instead of merely acting as a currency people can use to buy goods or services, ETH acts as a technology that developers can build decentralized applications and execute smart contracts on. This is where the use of non-fungible tokens (NFT) first came from and we probably don’t need to tell you the amount of buzz surrounding that space right now.
The main differences between the two lie in what they’re used for and how they’re obtained:
- Their goal and use – While Bitcoin aims to be a more efficient alternative to cash and an innovative payment system, Ethereum creates a network for developers to build applications and execute smart contracts.
- How they’re obtained – Bitcoin has a maximum supply cap of 21 million coins and each one is mined manually with specialized mining software. Although uses a similar form of mining at the moment (with goals to move to a proof-of-stake consensus mechanism in 2022), it uses graphics processing units (GPUs) to entice more independent miners.
In short, Bitcoin and Ethereum are two completely different cryptocurrencies: BTC was made as a peer-to-peer electronic cash system and although ETH can do the same, it also serves a separate function which is to provide a scripting language for smart contracts and decentralized applications and both can be obtain on exchanges like Bitcoin Evolution.
Will a bear market affect the race?
At the time of writing (January 13, 2022), BTC’s market cap is sitting at around 828 billion USD, while ETH’s is at roughly 398 billion USD. With prices declining in recent weeks, it’s reasonable to ask if a bear market could potentially change the race between the two crypto giants.
|Comparison (as of January 13, 2022)|
|Coin||Bitcoin (BTC)||Ethereum (ETH)|
|Price||43,666.14 USD||3,341.73 USD|
|Market Cap||828,318,110,419 USD||398,727,088,406 USD|
|Circulating Supply||18,927,612 BTC||119,139,078 ETH|
|Maximum Supply||21,000,000 BTC||Unlimited|
So, should you stick to your guns or start looking for a way to sell Ethereum at the best price to cut your losses? The truth is that arguably all of the major cryptos trend in the same way even if they do different things. This then means that there’s no point in comparing the value of both cryptos. The two can coexist and each provides value to the overall cryptocurrency ecosystem, completely taking price out of the equation.
Right now, it’s easy to say that there’s a lot of excitement surrounding with it making significant advances in decentralized finance and ETH 2.0 just on the horizon. However, there’s no telling what’ll happen in the future.
In terms of price, it’s possible that will outperform Bitcoin—but where does that leave it in terms of the race? If you take a look at their market caps and then combine it, the amount is still a lot lower than some of the world’s biggest companies. The point is that there is enough room in the world for both of them to coexist.
This then begs the question: why are we even comparing them in the first place? ETH remains to be one of BTC’s main competitors and has established itself as a platform for NFTs, but BTC will always be the key driver of the crypto market. At the end of the day, they’re two completely different cryptocurrencies that serve unique purposes—all you need to do is choose which one better suits your needs.
Are you looking into these cryptos as a means of investment? Which one makes more sense for you? Bitcoin or Ethereum? The good thing is that anyone nowadays can get a secure cryptocurrency wallet and invest in both—there’s plenty of room.