Ethereum is catching up with Bitcoin

The rapid growth in the value of the second largest cryptocurrency, Ethereum, comes amid its growing use in decentralized finance (DeFi).

DeFi Altcoins Promote ETH

If we talk about Bitcoin, then today the main digital coin is quietly consolidating in a narrow range, in the range of $52–59K. But with ETH, everything is different. The main beneficiaries of its strong launch were altcoins, which generated impressive profits. Dogecoin has been an obvious outlier with an increase of thousands of percent since the beginning of the year, making the meme coin the third-largest cryptocurrency by market capitalization, at least for the time being.

We are not going to go into the merits of Dogecoin or its dynamics, but one thing is for sure: cryptocurrencies are a revolutionary new financial technology that is directly related to the madness and creativity of the Internet. Getting back to some of the data-driven side of things, today’s analysis by Intel’s Chainalysis Market highlights how the influence of Ethereum has increased to Bitcoin over the past few months.

The first graph above shows how many Bitcoins can be bought for Ethereum. Currently, one Ethereum can buy at least 0.05 BTC, which is the highest exchange rate since August 2018. Thus, Ethereum is now starting to recover its value compared to Bitcoin after the price decline during the crypto winter of late 2018. In mid-2017, Ethereum was worth about 0.15 BTC, and in December of the same year, it fell sharply, compared to its current value. This ratio rose again in January 2018, when ETH brought in 0.10 BTC.

Percentage Profit of Ethereum Holders

Surge in DeFi activity

Decentralized exchanges (DEX) are not included in the category of exchanges, so DeFi’s dominance over Ethereum is perhaps even greater. But most of the Bitcoins moved in the blockchain, on the contrary, are sent to or from exchanges, and this has not changed in the last 24 months.

The dynamics for both Bitcoin and Ethereum are different, while the former is growing due to its scarcity( limited supply), the latter is growing due to its massive use in DeFi. Both of these unique and valuable coins are undergoing major changes, but in different directions.

Source: https://news.bit.team/ethereum-is-catching-up-with-bitcoin/

Official website: bit.team