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Bitcoin is no longer the cryptocurrency king

Wednesday, 5 May 2021

 The world's first cryptocurrency has some competition on its hands as Ethereum has finally reached the $3,000 milestone as its token Ether has quadrupled in price since the beginning of this year.

While Bitcoin has been the world's go-to cryptocurrency for some time now, Ethereum's recent rise suggests that there is still room for competition as the crypto market evolves.

One thing that sets Ethereum apart from Bitcoin is the fact that it provides the infrastructure for both the NFT (non-fungible token) and decentralized finance (DeFi) industries which have both seen tremendous growth over the last six months.

However, Bitcoin still has a much larger market cap at $1.1tn compared to Ethereum's $390bn but this could certainly change with more investors and projects buying into the Ethereum blockchain. In fact, just last week, the European Investment Bank (EIB) announced its plans to launch a digital bond sale on the network at the price of $100m.

Ethereum rally

At the time of writing, one Ether is currently valued at $3,291 and Ethereum has seen its value rise by 10 percent on Monday alone.

Other factors that have contributed to Ethereum's recent rally include the fact that next generation of the Ethereum blockchain, known as Ethereum 2.0, went live at the end of last year and the cyrptocurrency exchange Coinbase was listed on the NASDAQ exchange under the ticker COIN last month.

At the end of last year Ethereum was trading at less than $1000 per coin before it shot up in January 2021 and hasn't slowed down since. Now that Ethereum has hit $3,000, some investors are wondering if the cryptocurrency will continue its rally to reach $5,000. Bitcoin on the other hand has failed to recover since it fell from a mid-April record of almost $64,870.

Only time will tell if Ethereum continues to gain ground or if we'll see another market correction similar to the one which took place in 2017.

For the same reasons of being the first in history, bitcoin is now the model crypto coin and the one everyone associates to digital money. It is like Coca-Cola in the drinks industry, McDonald’s in the fast-food industry, or Nike in the sports apparel industry. When you think of an example product, you think of such brands. Well, when an average Joe starts contemplating cryptos, it is BTC that comes to mind first. This then reflects itself in the investments from new users who usually make their initial investment in bitcoin and nothing else. Despite its infamy of volatility and sudden jumps and falls nobody can follow or expect, it is still the main player in the game.

Best of all, due to the mainstream approach towards it, it is now a legitimate form of payment on numerous online shops, as well as in real-world stores. High profile techies, celebrities, and businessmen like the Winklevoss Twins, Bill Gates, Elon Musk, and Ashton Kutcher, Floyd Mayweather, Lionel Messi, and Snoop Dogg are all avid supporters who speak highly of bitcoin and who actively invest in it. There is hardly anything better than the support from the world’s most famous individuals. Brand recognition is at its highest with BTC.

Towards the end of 2020, bitcoin experienced another sudden rise in worth per single coin. By then, the record was nearly $20,000 which happened in December of 2017. For the better part of 2020, the leading crypto kept a rather favorable and steady value of between $11,000 and $13,000. However, starting from November of 2020, it started to rise slowly and ended the year with a worth of $28,990. An absolute record.

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