Knowledge

Will Ethereum Overtake Bitcoin?

In a recent report from Bloomberg, Arca’s Bodhi Pinkner predicted that Ethereum (ETH) will become deflationary after the “Merge,” scheduled for September, helping the network transition from Proof-of-Work ( PoW) to Proof-of-Stake (PoS) after years of delay.

Earlier this month, Lucas Outumuro, an analyst at crypto research firm IntoTheBlock, estimated that the rate of issuance of the second largest cryptocurrency in terms of capitalization would be between -0.5% and – 4.5% after Merge.

Source: Lucas Outumuro

This means that Ethereum will become increasingly scarce, giving it an edge over Bitcoin. The fact that the circulating supply of an asset continues to decrease is also a good sign for the price.

ETH is currently trading at $1,690 on spot exchanges, down 1.16% over the past 24 hours but still up 8.4% on the week.

ETH daily chart. Source: CoinCu

The ETH/BTC pair has rallied around 34% over the past month due to the excitement surrounding the much-anticipated “Merge” upgrade. However, the pair is down more than 12% from its year-to-date high of 0.82. It should also be noted that ETH/BTC is down as much as 54% from the all-time high it reached in June 2017.

Many experts believe that the current macro environment could be favorable for Ethereum.

The US Federal Reserve (Fed) has focused on fiscal tightening since the end of 2021, putting great pressure on the prices of leading cryptocurrencies.

Bitcoin dominance has been steadily declining since the beginning of 2021 to 41.1% at the moment, with Ethereum and other top altcoins dominating its market share.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Harold

CoinCu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.