The digital currency space has reached new heights with a total market cap of more than $24 billion, an all-time high. The main driver appears to be the two biggest digital currencies, bitcoin and ethereum, which have attracted adoption based on different use cases.
Digital Currencies Reach an All-Time High Market Cap – image from coinmarketcap
Bitcoin is now seen as a hedge and a useful addition to investment portfolios due to its unique nature which means it is uncorrelated with any other assets, making it highly desirable for diversification as it reduces total risk while potentially increasing gains.
In particular, anticipation over the bitcoin ETF which, if approved, would bring in Wall Street, has propelled the currency to its highest level ever, surpassing gold. A historical event that may have significant psychological effects as the currency now proves its value.
Ethereum, a barely two years old digital currency has in a short time created a highly vibrant, dynamic and very innovative happy ecosystem with discussions ranging from primitive artificial intelligence to preventing cheating in fantasy sports. Its market cap has recently reached an all-time high.
The eth community speaks of a flipping – a point when ethereum’s market cap overtakes bitcoin. They argue the new currency can do everything bitcoin does, but better, and then some more. They say eth’s transaction times are in seconds, fees almost nonexistent, taking bitcoin’s mantra of as good as free and instant global payments.
Bitcoin, but better? Perhaps, but the two are different and as we have seen recently can both grow. Bitcoin is more concerned with gold-like qualities, something you uselessly hold as a hedge against monetary mismanagement. Eth is more concerned with codable cash, money you or machines spend either manually or automatically. It is further concerned with a much wider range than just money. Chronicled, for example, secures the authenticity of sneakers through eth’s blockchain to prevent fake goods.
Bitcoin, through Rootstock, can take some of eth’s niche while ethereum could make obsolete bitcoin’s gold claim by themselves capping coin issuance. They both are trying, but Rootstock has problems from a user perspective while eth, though there are suggestions it will be limited to around 100 million, might still have some inflation.
They, therefore, appear more complementary, at least for now, but many are asking: brothers or foes? The market hasn’t decided, instead appears to be betting on both.
Regardless of how matters may further develop, both communities, which often overlap, have much to celebrate. Bitcoin just surpassed gold parity, eth just surpassed silver parity. Both are at or near all-time high. The boom times have arrived.
Source: cryptocoinsnews
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