- ETH could be the better cryptocurrency of tomorrow than Bitcoin.
- The odds of a strong rally in ETH are still slim.
Crypto investors will likely be reevaluating their portfolios now that the market has ended in bearishness for 2022. There have been many opinions, but we were drawn to the ETH analysis by one CryptoQuant analyst.
Read Ethereum’s [ETH] price prediction 2023-2024
The pseudonym-using analyst Ghoddusifar ETH may be the better cryptocurrency of tomorrow than Bitcoin, suggests this analysis. The analysis was based primarily on the fact that Ethereum can be used in more segments than Bitcoin, such as NFTs and dApps. According to Ghoddusifar’s assessment, the demand from these multiple segments has the potential to make ETH more useful.
Red versus blue
But will ETH be able to surpass BTC as the most popular crypto in 2023. Ethereum packs a punch in terms utility. BTC has shown multiple times that it is the dominant crypto currency. It still holds the lead in terms of market cap and is the first-mover.
Source: CryptoQuant
The analyst did highlight some of ETH’s downsides, such as the fact that it has higher transaction fees than Bitcoin. From a mass adoption perspective, this puts it at a disadvantage over Bitcoin. Although Ethereum went through major changes, it could transition into the fast track in 2023.
Will 2023 be a good year for ETH?
ETH’s open interest has been growing for more than two weeks now, suggesting that demand in the derivatives market is recovering. Long liquidations are also down. This could indicate that bulls are in the ascendance.
Source: Santiment
However, this is not all bad news for ETH as exchange reserves have increased in the past two weeks. Investors are often moving their ETH from private wallets onto exchanges due to an increase in exchange reserve. Most often, this is done with the intention to sell.
Additionally, fund holdings saw outflows in December which suggests that institutional investors were trimming their ETH accounts.
Any upside potential in the coming days may be limited by the lack of institutional buying pressure. This does not have to be true if this week’s bullish start is the beginning of the next bear markets. That is a big “if” but if it happens, then we might see a resurgence of institutional demand.
A 0.15x hike on the cards if ETH hits Bitcoin’s market cap?
Conclusion
Although ETH is showing some positive signs, it still has a lot of upside. While it might be challenging for the top spot, it will still have to compete against other contenders that offer similar solutions or even better.
Lastly, Bitcoin as well as ETH have their own strengths and weaknesses. ETH isn’t that far behind Bitcoin in terms market cap. There is a chance that ETH will surpass BTC even further down the line.