Ethereum to exted its violent move higher as multiple drivers still look supportive – BBH
|All major cryptocurrencies climb. Ethereum was the first of the top digital assets to move this time. ETH broke violently higher from its August range, rising some 15% over the last four sessions and pulling well ahead of bitcoin. In the view of economists at BBH, Ethereum is set to consolidate its gains.
Ethereum to continue beating Bitcoin
“Multiple forces are supporting Ethereum, including EIP 1559, which embeds a burn mechanism in transaction fees to reduce supply, leading to ETH inflation rate dropping from around 3% to 1%.”
“The boom in non-fungible tokens (NFT) and blockchain gaming continues. There are also some major developments to improve ETH's scaling and lower transaction costs in what is known as ‘layer 2’ solutions, such as Optimism and Arbitrum, which just went live. These solutions may reinvigorate appetite for decentralized finance protocols, which are still recovering from the slump in Q3.
“All of this could mean the continued outperformance of ETH against BTC and a greater risk of a ‘flippening’ – when the market cap of ETH ($434 bln) surpasses that of BTC ($906 bln).”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.