Bitcoin vs. Ethereum: Which Is a Better Buy in 2021?
Bitcoin was first traded in 2009. Back then, one of the new digital tokens could be purchased for less than 1 cent. Prices rose steadily, albeit with some volatility over the years, and in January 2021 they hit an all-time high of nearly $ 42,000. Ethereum debuted in 2015 at under $ 3 and skyrocketed to over $ 1,400 in 2018. At the time of writing, Ethereum is trading at just over $ 1,300.
By comparison, General Electric Co. (ticker: GE) shares hit $ 2.83 for the first time in 1995, adjusting for dividends and the stock split. Today, a quarter of a century later, it costs about $ 11.
Although they are the two largest cryptocurrencies by market capitalization, the similarities more or less end there. Bitcoin and Ethereum are totally different animals, developed for different reasons and with different internal dynamics.
But enough of the story: investors want to know which is the best buy: Bitcoin or Ethereum? Here’s a quick rundown of some of the most important considerations regarding investment prospects for each cryptocurrency. for more information visit this site (Pay Slik)
The de facto leader in cryptocurrencies, no other currency even comes close to Bitcoin or BTC. At the time this article was written, the dollar value of all outstanding Bitcoin was around $ 625 billion. The total market capitalization for all cryptocurrencies is approximately $ 1.07 trillion, and the second most valuable digital currency is Ethereum, with a market value close to $ 150 billion. for more information visit this site (Pay Slik)
Here are some key things investors need to know about BTC in the Bitcoin vs. Ethereum investment debate:
1. Maximum attention from large investors. The Winklevoss twins, the famous Harvard alumni who claim Mark Zuckerberg stole their Facebook (FB) idea, tried to start a bitcoin ETF but were rejected by the US Securities and Exchange Commission.
While the SEC may not be crazy about BTC, institutional investors have become increasingly excited about the idea, and in recent years, the ability to trade Bitcoin futures contracts has helped formally induce cryptocurrencies as an asset. widely accepted in the investment community.
2. Relative stability, simplicity, and acceptance. A decentralized currency, out of reach of the Federal Reserve or any other central bank and with a predefined maximum supply, is an attractive concept that people around the world can resonate with. And in the case of Bitcoin, the high market views on that concept have been thoroughly tested and validated over time.
“Bitcoin is a scarce digital currency and a store of value. While it remains volatile, it tends to be one of the most stable cryptocurrencies, with the longest history and has been the most consistent and best-performing investment asset year over year. year for the past 10 years, says Steve Ehrlich, CEO, and co-founder of Voyager Digital, a crypto asset that broke.
Alex Adelman is the CEO and co-founder of Lolli, the first bitcoin rewards app that allows people to earn bitcoins while shopping online.
We believe that bitcoin is a revolutionary currency that is digitally scarce, that anyone in the world can participate in, that is unique to anything else, says Adelman.
3. Limited offer. There will only be 21 million bitcoins; That known global supply limit is one of the main reasons cryptocurrency is viewed by some investors as similar to digital gold. However, unlike gold, newly discovered reserves are not possible and almost 90% of bitcoin has already been mined, or 18.6 million.
The new BTC creation rate is also reduced over time through a process known as the bitcoin halving, which cuts the bitcoin creation rate in half every 210,000 block transaction. The last bitcoin halving was in May 2020; At the current rate, the next halving will be sometime in 2024. for more information visit this site (Pay Slik)
Before you ask yourself Should I buy bitcoin or Ethereum? You must understand the different motivations behind Bitcoin and Ethereum.
1. Ethereum: a different target than Bitcoin. The two leading cryptocurrencies have drastically different use cases and goals, with Ethereum operating as a decentralized network on which applications can be built. Many cryptocurrency tokens are issued through the Ethereum network.
When people compare Bitcoin and Ethereum it’s a bit like comparing gold to electricity. They are both valuable but have very different uses, says Adelman. Ethereum is infrastructure. It is a blockchain that is in its infancy, but it has the potential to revolutionize finance and technology.
The ability to use the Ethereum platform to change the way mortgage transfers, securities trading, and many other fields work, has helped it achieve its next role.
2. More development. Naturally, because Ethereum’s usefulness is only limited by the ingenuity of the world’s developers, there is more activity surrounding the platform. Technically, the cryptocurrency used to facilitate Ethereum transactions is called ether, but it is popularly known as Ethereum.
Either way, the number of repositories related to Github Ethereum is 247 compared to four for Bitcoin. Repositories are similar to project folders where developers collaborating through Github can access project information.
3. A fundamental change in how blocks are created. Instead of miners with the highest computing power having the greatest advantage in successfully creating new tokens, that right is now granted to those with the largest ownership stakes.
Ethereum has been upgraded to create new ETH through a process called proof of stake (PoS), says Daniel Polotsky, CEO and founder of CoinFlip, a leading Bitcoin ATM operator. With PoS, users must deposit collateral or ‘stake’ in the form of ETH to become a validator on the network. Therefore, the more shares of ETH, the higher the value because there is less ETH in circulation. Polotsky explains.
Also, proof of stake eliminates costs associated with mining, such as electricity and hardware costs, which means that miners will sell less ETH. Instead, these ETH will be staked, further increasing the value says Polotsky.
The growth of decentralized finance, or Defi, is another extremely bullish catalyst for Ethereum. The concept is that traditional financial intermediaries such as brokerage houses and exchange houses are eliminated; This idea has gained widespread new relevance in recent weeks, as some brokerages such as Robinhood banned investors from buying stocks such as GameStop (GME) and AMC Entertainment (AMC), among others. for more information visit this site (Pay Slik)
Should you buy Bitcoin or Ethereum?
When it comes down to it, the final debate between Bitcoin and Ethereum as investments comes down to an investor’s risk profile. Both are poised to perform well over time as the world becomes more digital and acceptance of cryptocurrencies grows. Bitcoin is the more mainstream and stable of the two, although bullish sentiment among experts in the field appears to have grown over the past year for Ethereum.
As with most investments, Ethereum’s higher risk can come with the possibility of higher rewards. In any case, it is no longer 2009: both coins have passed the proof-of-concept phase; Now is the time for investors who have not considered this asset class in the past to start taking both BTC and ETH seriously. for more information visit this site (Pay Slik)