While the price of Bitcoin was dropping in June of 2021, trading volumes at some of the largest crypto exchanges such as Coinbase, Binance, Bitstamp and Kraken experienced more than a 40% drop in the same month.
Now while it is worth noting, while overall trade volumes typically slow entering a late summer holiday season, there has been one underlying trend making headlines which is the rate of growth of trading volume for Ether compared to Bitcoin.
There are many fundamental arguments to be made supporting this trend but putting those aside for the moment, what is more important is the fact globally, Ether could be making headway to one day topple Bitcoin as the crypto investment of choice and trading volume alone could be signaling that more players both on the institutional side and retail as well are coming around to this way of thinking.
A research report out of Coinbase detailing trading volumes from 20 of the world’s largest exchanges, shows Ether trading volume in the first 6 months of 2021 hit 1.4 trillion and was up 1,461% from the same period in 2020. This compares to Bitcoin trading volume growing only 489% in the comparable period.
A recent report out of Singapore detailing crypto investor’s profiles, there were more holders of Ether with a 78% popularity of holders to Bitcoin’s 68% in holder’s portfolios.
This is also reflecting in the relative strength of Ether to Bitcoin as of the same period also, and at the same time holding a 5 year uptrend of increasing relative strength..
The estimated number of addresses with a crypto balance shows nearly 20 million more Ether holders than Bitcoin holders lending somewhat to the utility arguments of Ether proponents.
If one were to turn to a major Wall Street institution to make the call on the debate between Ether and Bitcoin, only just a couple weeks ago, Goldman Sachs published a report and were quoted as saying Ether was looking like the cryptocurrency with the “highest real use potential as Ethereum” with Ethereum being “the most popular development platform for smart contract applications”.
One could almost translate this report to mean that Ethereum could serve as a future app store if one were to use a layman’s analogy. Regardless this commentary from Goldman supports a very bullish sentiment when assessing the investment worthiness of Bitcoin vs Ether.
With the recent public offering of Coinbase and their most recent earning’s report showing a nearly 12 fold increase in revenues to 2.23 billion from the earlier year period, this is solid documented evidence that Fintech and the crypto world are gaining some serious traction of growth and participation across all borders.
The best of some of the largest tech companies could achieve for growth were examples like Amazon showing top growth of around 300% in 1998. Facebook never achieved triple digit single year growth and even google only had a few quarters of doubled growth back in 2004 and 2005.
Trading in non-fungible tokens, NFTs, has been soaring in recent months and this only adds to the popularity and use case of the Ethereum blockchain and Ether in particular as most of the NFT ecosystem resides in this development network.
Some have postulated that the NFT marketplace could transform the art market, the music business or any other forms of digital creation and this has many excited about what this has in store for Ether and Ethereum.
Regardless of which coin or token will be most popular, the technology requirements behind the trading of, the development of and the utility of these instruments will require innovation, marketability and a streamlined user experience.
The regulatory atmosphere has eased to the point of more acceptance of the various exchanges, public markets and overall realization that these asset classes do have real world utility and will be monitored and policed where all participants will have necessary protections.
As with any new technology and impact to the typical consumer or retail participant, discretion and a cautious tone should be applied across all avenues of execution.
As we enter a new decade, one must recognize the early indications that the digital tokenization and participation of all market participants are fast rising trends and the growth metrics are breaking records in many traditional test cases or otherwise formally executed entities.
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