As the ETH Price Surges: Is Ethereum Going to Overtake Bitcoin?

The surging price of Ethereum has raised eyebrows and hopes across the planet, but why is this happening and what level can we expect its price to reach in the future? Potential investors still have the amazing Bitcoin price rally fresh in their minds - it made many early adopters into millionaires and billionaires -  so maybe we should take a moment to consider whether Ethereum can overtake this token at some point in the future.  

What is Ethereum?

First up - what are we talking about? Well, Ethereum has been around since 2015 and it’s considered pretty much the first altcoin. Bitcoin (BTC) had already been live for a good few years when Ethereum launched. That means some people still see it as the bold big brother and Ethereum as the new crypto kid on the block... but could that be changing? 

The Ethereum network promised something different by allowing revolutionary new stuff like smart contracts and decentralized applications. This pushed forward ideas like decentralized finance (DeFi) and non-fungible tokens (NFTs) and promised a whole new world of crypto activity - an exciting one.

The ETH token is the native currency of the Ethereum network. ETH tokens were worth $0.42 in those early days when only experts and - let’s be honest - internet nerds knew about them. But the price has soared by over 600,000% since then to turn this late entrant into the crypto race into the second biggest token behind the unstoppable force that is BTC. ETH is used for various reasons, such as paying gas fees, covering the cost of smart contracts, and buying headline-grabbing NFTs - which some people view as the most modern form of art.

The currency is used in other ways too, which keep the price buoyant, such as in staking transactions. And that’s not all; we’re turning to fun with it as well. The rise of the crypto gambling industry has produced Ethereum casino platforms, where players can bet on slots, table games, and other casino games using ETH. They move ETH to the casino’s public wallet to add funds and gamble. If Lady Luck takes a seat beside them, they can withdraw their winnings in the same way, straight back to their original wallet. It’s neat, clean, and ideal for many.

Why Is the Price Climbing?

Ethereum’s price has risen and fallen many times since its launch, with technical advances, media attention, and other diverse factors all playing their part at different times to keep investors on their toes and poring over their price charts.

The link between crypto price swings and other financial markets sharply divides opinion, with some analysts believing that digital currency prices react more to certain external factors - like inflation and interest rates - than others.

The Ethereum network transfer volumes and gas fees have been in the news in recent weeks as network activity has increased significantly. This has led to a relatively modest price increase, but it’s the slowly building momentum that has turned the heads of analysts looking for something to talk about. It’s too early to say for certain, but there are some suggestions that this could be a sign that ETH and other cryptocurrencies are finally going mainstream in a big way.

The launch of Ethereum exchange-traded funds (ETFs) a few months ago was another crucial change that has helped to push up interest levels and send the price spiraling up again. This instrument makes it easy for any type of investor to take a chance at predicting price changes, with a couple of billion dollars already going into these ETFs at the time of writing. Ethereum is becoming a more established part of the mainstream financial system. Maybe you’ve heard people talking about it when you order your morning cappuccino - we wouldn’t be surprised!   

What Does the Future Hold?

If we go back to the original question, the price difference between BTC and ETH is still far too large to imagine that the Ethereum token will soon become the biggest cryptocurrency. There have been periods in the past when ETH has outgunned BTC in the market but it has never gotten close to passing the other token’s value.

Bitcoin is largely seen as an investment or a store of value - not much else. Its original purpose as a way of seamlessly sending money on a peer-to-peer basis has been overshadowed by its enormous investment potential, with many early adopters now regretting that they didn’t hang onto more of their BTC.

Other altcoins and stablecoins fill the gap in the market for transfers, with Tether and Ripple among those that are used to move cash around the globe effortlessly, while major banks look for innovative ways to use the blockchain for quicker settlement times. ETH has a unique position in the market, as it helps drive many of the most interesting parts of the blockchain world, thanks to its NFTs, smart contracts, and decentralized apps. 

Therefore, the performance of ETH isn’t affected by exactly the same things that drive up the price of BTC. The comparison between the two tokens has never been fair and it’s become clearer in recent times why that’s the case. The internet is filled with predictions of the future prices of ETH and BTC, but these predictions vary widely, so there isn’t a baseline that we can use to suggest what’s most likely to happen next.  

The future looks bright for Ethereum, but we should avoid falling into the trap of seeing it as being in some sort of competition with Bitcoin. Both currencies may continue to prosper, but this is likely to be for completely different reasons, and ETH is probably going to still be seen by many as the little brother of that big giant.