round gold colored ethereum ornament
Photo by David McBee on

Ethereum is the second-largest cryptocurrency in existence, and the commercial giants at Wall Street predict that Ether will eventually flip Bitcoin over. Although for a while now, Ethereum has been the closest challenger to Bitcoin. In the long run, Ethereum might outperform Bitcoin.  

This is because its utility alone stands to outstrip everything else, according to Two Primes (Cayman Island-based institution that offers exposure to Bitcoin and Ethereum) Nathan Cox.

In comparison, in the Ethereum Market cap in 2020 and 2021, there is a surge in price in liquidity and market representation. Ethereum’s popularity has been attributed to the growing adaptation of DeFi and NFTs. Both built on Ethereum’s Blockchain. 

The Ethereum Hype has a support claim to the new financial era and has a basis, which many rookie and experienced traders alike try to be a part of. Ethereum was launched in 2015, and its growth rate is high compared to how long Bitcoin took to crack the market. Its liquidity pool can support many investors at a go, and its development was well planned as its release was met with supporting material.

Bitcoin has been referred to as digital gold in the global cryptocurrency market; ethereum has now been termed digital oil. Supportive sentiments from international business moguls such as Elon Musk and Paul Tudor Jones have significantly affected how the crypto market unfolds due to its volatile nature.

4 Reasons why Ethereum will Outperform Bitcoin

Firstly, when Bitcoin was launched in 2009 by a developer under the pseudonym Satoshi Nakamoto, his Whitepaper did not leave enough room for bitcoin to adapt to changing times. Bitcoin is ill-planned to adjust to the new market, and that gives it static development. He introduced digital currency but did not cover grounds for a change soon. 

Secondly, Ethereum’s Blockchain is constantly under development as new protocols are added daily. The development team behind Ethereum, led by the Russian developer Vitalik Buterin has been responsible for Non-Fungible Tokens (NFTs) and Decentralized Finance (DeFi). The addition of these two protocols has led to a massive flow of investors to Ethereum. As technology advances, Vitalik assures Ethereum’s users that he is prepared to change whatever is deemed necessary to incorporate technological advancements that improve trading.

Thirdly, Bitcoin is not environmentally friendly as it consumes tons of power to verify transactions. Research conducted indicates that electricity energy used by a tiny country yearly is used to mine bitcoin in equal measure. Ethereum has released ETH 2.0 that has shifted from proof of work to proof of stake that consumes electricity on lower bills. 

Lastly, Ethereum has a high demand base and investor user cases more than bitcoin. Furthermore, Ether has high-speed transaction rates, and as a result, Ether tokens have higher liquidity than Bitcoin. Estimates put them at 11% (Ethereum) against 4% (Bitcoin); with these market numbers, it is a matter of time before Ethereum takes up first place in the digital financial market.

Bitcoins` un-developing nature may be undoing; every product in the global economy requires strategic development once in a while to keep up with the times. For example, if Windows stopped creation at version 1.0, then there wouldn’t be much to say about the Microsoft company led by Bill Gates. Ethereum developers understand this aspect of the trade, and they are up on task developing Ethereum daily.  

In the recent cryptocurrency Market Crash, we witnessed Bitcoin take a hard fall compared to Altcoins, especially Ethereum. JP Morgan states that Ethers resistance is among the qualities that will survive the cryptocurrency Volatile market; its resistance ability will overshadow bitcoin in no time. Ethereum has been able to recover from the liquidity shock faster than Bitcoin did.

Ethereum has managed to link traditional finance with digital finance through decentralized finance (DeFi); the incorporation led to creating Stable coins (crypto coins with the backing of fiat currencies such as the USD or Sterling pound). However, Ethereum is not without competition in days to come; the essential aspect about Ether is on a constant alert to improve efficiency, seal loopholes, and fix system bugs.

Ethereum’s Future

Ethereum is skyrocketing in value, in addition to the growing attention from social media platforms (Twitter, Facebook, and Telegram) and institutions such as JP Morgan, MasterCard, and the excitement building around ETH 2.0 has created enough market space for Ethereum’s takeover. Ethereum has revolutionized finance with its range of products and multiple use cases for its Blockchain. Investors are making money through Ethereum by providing liquidity to its DeFi products, which have created many headlines since 2020.  

Ethereum has not fully realized its products’ full potential, such as DeFi and NFTs (especially NFTs). I can’t help but wonder what lies ahead for Ethereum. Ethereum and Bitcoin represent two heads of the same financial body: a currency token (Bitcoin) and a utility token (Ethereum).