Bitcoin overshadowed by altcoin: ether broke the record

Ether thus lags behind the development that took place at the rate of the dominant virtual currency bitcoin. It broke its record in December and then improved it twice more. The last few weeks, however, belong to ether. In a month-on-month comparison, it strengthened by 108 percent, while bitcoin by 56 percent.

This confirms the forecast made by Cointelegraph analyst Michaël van de Poppe two weeks ago. “I believe we are witnessing the overflow of money from bitcoin towards altcoins (digital currencies other than bitcoin – author’s note) and that the ether will only grow against the dominant cryptocurrency. Therefore, altcoins can probably be expected to strengthen further in this quarter and the position of bitcoin to weaken relatively. ” he wrote then van de Poppe.

Current ether rate:

In the world of cryptocurrencies, the entire market is usually relatively tightly tied to bitcoin, which accounts for about two-thirds of the digital coin market. It is therefore realistic to expect that fluctuations in the value of the dominant cryptocurrency will sooner or later spill over even among less valuable digital coins. However, often with greater intensity.

Proponents of ether perceive it as a precursor to the future functioning of cryptocurrencies compared to bitcoin. Ethereum, a five-year-old technology platform on which Ethernet operates, offers, for example, the function of so-called smart contracts. They can be used to program new types of financial applications that control, for example, credit management, interest payments and other operations that could do without a standard banking intermediary.

However, unlike the twelve-year-old bitcoin, the number of ethers in circulation is not capped. Bitcoin has also been benefiting from demand from larger investors recently, precisely because of the deflationary currency label given to its holders. He is also significantly helped by the policy of central banks and the printing of additional money to combat the coronavirus crisis, which raises fears of an accelerating inflation rate. There will never be more than 21 million Bitcoins.

However, skeptics refer to cryptocurrencies as a speculative investment that has no intrinsic value. According to critics, technological innovations such as Ethereum are not sufficiently tested and speculators may lose money due to possible technical errors.

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