Ether Surpasses Bitcoin in Weekly Value Increase, Bolstered by ‘The Merge’ and ETF Prospects
Ether Surpasses Bitcoin: Looking at the Basics
Ether (ETH) has put in an impressive performance over the past seven days, outperforming Bitcoin (BTC) in terms of value increase. While Bitcoin increased by 8.5% during this time, Ether was able to record a plus of 16%. The price of Ether has exceeded the $2,900 mark for the first time in almost two years. The Ether-Bitcoin exchange rate has risen by almost 7% to 0.055 during this time.
Ether on the Rise: The Reasons
The reasons for Ether’s rise lie in the fundamental data of the cryptocurrency. Unlike Bitcoin, which is experiencing a slowdown in growth due to the upcoming “halving,” Ether is showing a deflationary trend. This is due to the switch of Ethereum to a proof-of-stake consensus mechanism in September 2022, known as “The Merge.
Since “The Merge”, 1,047,643 ETH worth $3.05 billion have been issued and 1,407,200 ETH have been burned, resulting in a net reduction of the supply by 359,557 ETH or 0.209% year-on-year. During the same period, the supply of Bitcoin increased by 1.71%.
The Future of Ether: ETFs and Reduced Transaction Costs
The outlook for Ether continues to be positive. The U.S. Securities and Exchange Commission (SEC) is expected to give the green light for Ether ETFs this year. Several major companies, including Franklin Templeton, BlackRock, Fidelity, Ark, and 21Shares, have already applied to set up such an ETF.
Furthermore, the Dencun update is expected in March, which should reduce transaction costs. In combination with the reduction of the Ether supply and the possibility to acquire Ether via ETFs, this could make Ether an even more attractive investment option.
The number of Ether staked or locked in the network exceeded 30.1 million at the beginning of this month, accounting for 25% of the total circulating supply. This shows that interest in Ether remains high.
Conclusion
The recent developments with Ether are further proof that the cryptocurrency is a serious competitor to Bitcoin. Ether’s fundamental data are strong and the outlook for the future is promising. It remains to be seen how the situation will develop in the coming months, but it’s clear that Ether is a cryptocurrency to watch.
Sources: CoinDesk, Ultrasound.money
