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$1,539,597,018,617
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The Outlook For The Second-Largest Crypto To Date Is Bullish, As Long As Bitcoin Holds Up

Bitcoin has struggled to keep its price trend going up in November, closing the month with a 7% price decrease, while the total crypto market capitalization only decreased by two billion dollars.

The reason for the difference in overall market performance and Bitcoin’s price decrease is no other than Bitcoin losing its dominance to altcoins. Bitcoin’s dominance fell down from 44% on November 1 to 41.6% at the end of the month.

Meanwhile, the second-largest crypto to date, Ethereum (ETH) managed to secure an 8% price increase, pushing its dominance over the crypto sector to 22.4%.

December’s trends seem to continue the trend seen in November, with Ethereum gaining ground on Bitcoin over the recent weeks.

One of the major reasons behind Ethereum’s rise is the (maybe) final delay of the difficulty bomb on Ethereum’s blockchain and the much-anticipated migration to ETH 2.0 and Proof-of-Stake consensus mechanism. Furthermore, the introduction of Ethereum Improvement Proposal EIP-4488 would further reduce Layer 2 gas fees by slashing call data costs in the months prior to the migration.

The second reason behind Ethereum outperforming Bitcoin is the rebound Ethereum made in the  ETH/BTC trading pairs. Between September 1 and October 19, ETH actually lost 25% in value in relation to Bitcoin, but then it rebounded and outperformed BTC by a whopping 44.5%.

Also, Ethereum is over ten times cheaper than Bitcoin, which means more novice traders are able to get their hands on a single ETH token, and the psychological entry barrier is much lower than Bitcoin’s. Furthermore, Ethereum’s gains in Q3 and Q4 of 2021 made investors consider Ethereum as a good, if not better, alternative to the crypto leader – Bitcoin.

However, there is yet another reason for Ethereum’s success over Bitcoin and the keyword is gas fees. The same gas fees that pushed Ethereum’s community into crisis mode several times in 2021 alone are also acting as a stopping barrier for small-scale investors to cash out of ETH holding, effectively lowering the amount of ETH on exchanges, which recently fell to a three-year low.

For instance, if a holder currently possesses around $250 worth of Ethereum, it would be unviable to go into cashing out, since the cost per transaction may easily reach a fifth of the holdings.

Meanwhile, Ethereum’s technical analysis, compared to Bitcoin’s, showcases a better price increase scenario for the altcoin leader, as ETH is merely 9.2% below its all-time high of $4,878, while Bitcoin is sitting 27% below the record valuation of $69,000.

Furthermore, Ethereum seems to have entered a consolidation period over the past three weeks, which is primarily associated with a price increase in the near future. However, the plans for a price increase are still tied to Bitcoin, as long as the crypto leader stays above its 200-day Moving Average.

Bitcoin Ethereum btc eth Ethereum news Bitcoin price bitcoin news cryptocurrency news crypto news Ethereum Price

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