Ethereum Could Overtake Bitcoin in Price Growth by 2024
Date: 2023-12-28 Author: Dima Zakharov Categories: BLOCKCHAIN
Ethereum's Potential to Outshine Bitcoin
Ethereum, the second-largest cryptocurrency by market capitalization, may soon outpace Bitcoin in terms of price growth, according to Andre Dragos, the head of research at ETC Group. This projection is underpinned by Ethereum's technological achievements and its established position as the primary platform for smart contracts.
Recent Performance Comparison
Over the past year, Ethereum has lagged behind Bitcoin in terms of price growth. However, Dragos asserts that this trend could reverse within the next 12 months, with Ethereum taking the lead in the cryptocurrency market.
Factors Driving Ethereum's Growth
One key factor contributing to Ethereum's price surge is the implementation of the "burning" deflationary mechanism, introduced in August 2021 through the London hard fork. The reduction in coin supply, combined with attractive staking rewards, could lead to a phenomenon known as "flipping," where Ethereum's market capitalization surpasses that of Bitcoin.
Staking Rewards as an Investment
Traditional investors may view staking rewards as analogous to stock dividends, making Ethereum an appealing investment choice. Dragos highlights that since its inception in 2015, Ethereum has consistently outperformed Bitcoin in terms of growth, with 2023 being the only exception.
Analyst Predictions
Coinbase researchers also anticipate Ethereum's return to average performance levels in the upcoming year, considering its "relative discount" compared to Bitcoin's price. However, they acknowledge that Ethereum faces challenges, including weaker fundamentals and decreased transaction activity in 2023.
Current Market Performance
In the past 24 hours, Ethereum has risen by 6.6%, reaching $2,374, while Bitcoin has seen a 1.4% increase, reaching $43,062, according to CoinGecko. Over the past week, Ethereum's performance has increased by 8.4%, while Bitcoin's has decreased by 1%.
Future Price Projections
Previously, Standard Chartered analyst Jeffrey Kendrick predicted Ethereum's price to reach $8,000 by the end of 2026, adding to the optimism surrounding Ethereum's potential in the cryptocurrency market.
