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Why can’t Ethereum overtake Bitcoin in the near future?


Analysts have been predicting for years that the market value of Ethereum may exceed the market value of Bitcoin, but various data show that this is just a simple guess.

to the Report Coin Telegraph After the 13% increase in the price of Bitcoin, the market value of this digital currency reached $ 800 billion. This is the highest value of the Bitcoin market in the last 79 days. In the same period, the price of Ethereum has managed to grow by 45%. This growth has pushed the market value of this digital currency to more than $ 340 billion.

Positive expectations from the London Ethereum update and the anti-inflationary effects of this hard fork have played a significant role in increasing the price of digital currency number two in the market; However, some investors continue to question how the price of Ethereum will perform better than the price of Bitcoin. Dan Morehead, CEO of Pantera Capital, believes Ethereum will replace Bitcoin at the top of the digital currency table.

Earlier, Neel Kashkari, the head of the Federal Reserve in Minneapolis, said that it was possible that the US Federal Reserve will continue its program of buying assets for a longer period. This increased the excitement of the market. According to Kashkari, the delta strain and its prevalence are potentially harmful to the labor market. He said about this:

[سویه] Delta may reduce people’s desire to return to jobs that require physical presence. Students may also be reluctant to go to school.

Continuation of financial assistance programs may increase the risks of inflation. This may increase the attractiveness of scarce assets such as real estate, commodities, stocks and digital currencies. Therefore, it can be said that the effects of these major changes may affect Bitcoin and Ethereum alike.

Active bitcoin addresses

A comparison of some Ethereum and Bitcoin indices can explain the difference in the market value of this digital currency with Bitcoin. The first criterion to consider is the number of active addresses.

Bitcoin and Ethereum active addresses
Bitcoin and Ethereum active addresses

As you can see in the chart above, Bitcoin has more than 6 million addresses worth $ 1,000 or more, and 3.67 million accounts have been created since 2020. Ethereum addresses, on the other hand, are less than half that number and 2.7 million. Ethereum’s active addresses are growing less than Bitcoin, with only 2.4 million addresses created since 2020.

Active Ethereum addresses, like the market value of this digital currency, are about 55% less than active Bitcoin addresses. However, this study does not show data related to the level of investment of large grain investors. It should not be forgotten that there is a good way to calculate the volume of investments of large investors. In the meantime, the review of tradable products on the stock exchange can be considered as an alternative.

Why can't Ethereum overtake Bitcoin in the near future?

After examining the tradable investment instruments on the stock exchange, the results show that Bitcoin is ahead of Ethereum with $ 32.3 billion in managed assets, with $ 11.7 billion in managed assets. Bitcoin Gray Skill Investment Fund, which has been operating since 2013, plays a key role in this dispute.

It is worth mentioning that the first tradable product with the Ether Exchange (Ether Tracker) entered the market in October 2017. It can be said that the obsolescence of tradable instruments in the Bitcoin exchange is one of the main reasons for the difference between related capitals.

Status of open futures contracts

Examining the reality of futures markets can also help us make better comparisons. Open contracts are the best criterion for examining the positions of professional investors, as they calculate the total number of market subscriber contracts.

An investor may have bought a $ 50 million futures contract and sold his entire position a few days later. This $ 100 million transaction volume represents an investor [حقیقی] It is not in the market and therefore it erases the data.

Why can't Ethereum overtake Bitcoin in the near future?

Bitcoin futures are currently at $ 14.2 billion, a long way from their $ 27.7 billion high on April 13. Bainance has the largest market share at $ 3.4 billion, followed by FTX with $ 2.3 billion in open contracts.

Why can't Ethereum overtake Bitcoin in the near future?

Ethereum open contracts, on the other hand, peaked at $ 10.8 billion a month after Bitcoin and are currently in the $ 7.6 billion range; Therefore, it can be said that Ethereum futures contracts are 46% lower than Bitcoin.

In the meantime, the profit situation of miners should not be overlooked; Because this index gives us good information about the current situation. It is worth noting that Ethereum and Bitcoin have different uses; For example, 54% of Bitcoin supply has been intact for more than a year.

In general, each index has its weaknesses and it is not possible to determine which digital currency is lower than its real value by relying on a specific index. However, looking at these three indicators, it can be concluded that Ethereum will overtake Bitcoin and become the number one digital currency in the market soon.

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