The battle of Ethereum vs Bitcoin price is not over yet, not until the government completely bans one of the cryptocurrencies out of existence. That certainly shouldn’t happen anytime soon, so let’s grab some popcorn and enjoy the show.
Ethereum vs Bitcoin price dynamics
The key takeaways in the bitcoin’s price dynamics are that:
It is actually the first technologically complete crypto currency of the world. Any other digital asset must fight for attention while bitcoin will always remain ‘the one and the only’.
The total supply of bitcoins is limited to 21,000,000 BTC. Such a measure ensures the scarcity of coins and negates inflation.
The mining reward decreases by a half every four years, which is another counter-inflation measure.
It cannot be upgraded without hard-forking the blockchain.
Ethereum blockchain, on the hand, is fundamentally different from bitcoin in the following aspects:
- The total supply is not capped.
- Ethereum mining reward will decrease noticeable only after the Ethereum Improvement Proposal #1559.
- Ethereum blockchain is not only a public financial transaction ledger, it can store any information or transaction type (via smart contracts).
It’s easy to make false assumptions based on this data. A year ago, newsbtc published an article, based on an assumption of an unknown cryptocurrency “expect”, that ETH price will never breach $1,000. That expert eventually had to remove their tweet as if nothing happened. ETH trades for around $2,000 right now.
Market is driven by sentiment and intuition, as we know. Human intelligence is simply incapable of processing so much loosely related facts, so commoners and experts alike are prone to error. Invest in ethereum vs bitcoin or any other crypto with care: don’t put too much on stake, day trade if you’re skilled enough, otherwise just HODL and sell in a couple of years. In fact, most of the newcoming BTC users do just that.
ETH vs BTC chart
Charts reveal the cyclical nature of price fluctuations. Of course, any price is influenced by a multitude of different factors, not just the time; nonetheless, a quick look at the price curve is very useful more often than not.
BTC price chart. Source: Coindesk.
The pump at the start of the year is evident. It is reminiscent of a similar pump in 2017: Bitcoin lost 80% of its price in the year that followed. There is a chance that the scenario will repeat, and the price is ready to start cooling down right now. It reluctantly tipped the threshold of $60,000 per BTC just recently.
So what waits for us? A long plateau of relative stability, a depressive decline, or a stubborn crawl to $100,000 and $150,000 as some traders guess? In this case, a ETH vs BTC chart provides no reliable insight on what will happen next.
As we already wrote, the price is largely determined by the moves of whales and mass media. So watch the tweets of Warren Buffet, Jeff Bezos, Elon Musk, and Justin Sun, and whatever Wall Street Journal or MasterCard have to say, among many other valuable sources.
Ether price chart. Source: Coindesk.
The historical overview of ETH vs BTC price over the course of a year provides the following obvious takeaway:
- There is a correlation between the prices of the two. Likely, ETH price retains a sort of loose proportion to BTC (not the other way around).
But we shouldn’t forget the two significant upcoming events: the ETH 2.0 update (this summer presumably) and the ultimate end of the Bitcoin’s surge.
Where the Ethereum vs Bitcoin chart may stop showing correspondence
Surely, the EIP #1559 event is a major Ethereum update that may introduce a noticeable change into the Ethereum vs Bitcoin chart.
- Transaction fees will burn, shortening the ETH supply and holding back inflation.
- The regular users will be happy because they won’t need to bother with manual gas price set up and sky-high fees in times of the network overload. As a pleasant extra, the carbon footprint of the network will drop after the introduction of proof-of-stake consensus.
- The optimal block space usage will ensure the better productivity overall. Investors will be happy with this, too.
- What about miners who are going to lose most of their share? They will drop off if their reward turns out too small compared to the alternatives like Ravencoin, Monero, Ethereum Classic, Ripple, Bitcoin Cash, and others.
However, the network basefee after the update is expected to stay reasonably high so most of the mining pools will keep supporting Ethereum, and its absolute value will indubitably rise, swaying the balance of prices on the Ethereum vs Bitcoin chart in favor of ETH.
Unless the value of Bitcoin surges faster! Can that happen and why?
Bitcoin’s protocols were not updated for about a decade now, which was the reason for the appearance of multiple improved forks (Litecoin, Dogecoin…) and more advanced solutions written from scratch (Cardano, Polkadot…). It will remain slow, bulky, limited in functionality, and insanely expensive. The last bitcoin will be mined in 2140.
Who is interested in pumping the BTC price and keeping its price up? The holders, of course. It so happened that the largest holders are also in power to create demand via mass media manipulations and spreading the fear-of-missing-out. As finance experts, these whales will know when to make the bear move and sell their largely overpriced assets, watching the bubble burst.
It is possible, the small investor will find themselves at loss. So we can only suggest watching Bitcoin with awareness that price is being pumped. In any case, all we have to do is to watch the Ethereum vs Bitcoin chart
Invest in Ethereum vs Bitcoin
The market is not as favorable to the simple folks as it used to be in the early days of crypto. Investing in ethereum vs bitcoin both have a high entry level. Besides, these two cryptocurrencies are not suited for small-volume transactions: if you want to buy a coffee from a retailer for a $3 value, but the transaction costs sit around $15 (which is true for both Bitcoin and Ethereum at the time of writing), then both of you will likely abstain from using it in daily lives.
As seen on the ETH vs BTC chart, ETH price repeats the pattern of BTC: is it the former causing the fluctuation of the latter, or vice versa, or is it just the reflection of the market mood at the moment? There’s no way to know for sure.