Coinbase just released news that institutions are beginning to pour money into Ethereum in addition to Bitcoin.
Let's offer you some unique insights into that trend.
What are the benefits of Ethereum compared to Bitcoin?
By now, people that have been paying attention to the developments within the crypto industry have figured out that Bitcoin is a store of value and the perfect reserve asset, comparable with gold, but much easier to transfer globally. Because it operates on a deflationary algorithm, the supply goes down yet is capped to 21,000,000 BTC, therefor it can not function as daily money. The reason is simple, nobody wants to use an asset that grows in value. Daily money will always need to lose some purchasing power over time (USD, EURO,...) Otherwise, why spend it?
Ethereum on the other hand offers more than Bitcoin with regards to its usecases: it functions as a store of value, but it also offers an application layer, and the programmable nature of its core will allow nations, banks, and companies to create future financial and other assets.
Where Bitcoin competes with gold and might well outperform gold's $10 trillion market cap, Ethereum acts as an immutable and transparent platform for products and applications within several sectors and industries, ranging from finance, to health and politics:
- DeFi: smart contract powered loans, stable coin minting, example: MakerDAO;
- Payments: smart contract driven, risk-free changeability of transactions;
- Initial Coin Offerings: funding method by which start-ups sell tokens to raise capital, example: Bancor;
- Politics: transparent and fair democratic elections that are publicly visible and not subject to fraud;
In my earlier article, Global Wealth: The Worlds Money and Markets. And where do Bitcoin and Ethereum fit in? Price projections. you can see that the market that Ethereum can be used for is much larger that Bitcoin's target: the gold market. Initially, people, even institutions might have focussed on Bitcoin, but they'll learn as they go on and diversify their money towards Ethereum, and then Ethereum projects...
In other words, we are on the verge of an Ethereum super cycle that might dwarf Bitcoin's achievements.