Ethereum to exceed Bitcoin's value 'within five years'

Ethereum to exceed Bitcoin’s value ‘within five years’

Ethereum will continue to outperform Bitcoin in 2021 and will, ultimately, exceed its rival’s value, predicts Nigel Green, chief executive and founder of deVere Group.

His prediction comes after a mixed few days for Bitcoin, currently the world’s largest cryptocurrency by market capitalisation.

Green said: “Ethereum (ETH) is outperforming Bitcoin (BTC) and it can be expected to continue this trend for the rest of 2021.

“Ether is up around 240% this year, while Bitcoin is up less than 38%. In fact, it has outperformed all other benchmark assets in the first half of this year.”

He attributes two key factors that are driving Ethereum’s outperformance run.

“First, Ether has a higher level of real-use potential as Ethereum, the platform on which it is the native cryptocurrency, is the most in-demand development platform for smart contracts, thereby highlighting that network’s value not only as a platform for developers but as a worldwide financial utility,” he says.

“Second, investor enthusiasm for the game-changing transition to ETH 2.0, which makes the Ethereum network considerably more scalable, sustainable and secure. These upgrades represent a major boost not just for Ethereum but for blockchain technology itself.”

He continued: “Ethereum is more useful than Bitcoin and has tech advantages over its better-known rival.

“Ultimately, this will mean that its value will exceed that of Bitcoin - probably within five years.

“That said, I remain confident that Bitcoin will hit, or even surpass, its mid-April all-time high of $65,000 by the end of 2021.”

Ethereum is more useful than Bitcoin and has tech advantages over its better-known rival.”

What’s Up With Ethereum Classic As It Follows Bitcoin, Ethereum Into Bullish Consolidation

Ethereum Classic (CRYPTO: ETC), Ethereum (CRYPTO: ETH) and Bitcoin (CRYPTO: BTC) were just a few of the popular cryptocurrencies consolidating on Tuesday. All three cryptos had a relative strength index (RSI) registering above 70% which put them into overbought territory and the consolidation was needed.

For technical traders, an extended RSI is a sell signal and some traders of the cryptos may have decided to sell some or all of their positions with the hope to buy back and lower or average down on their trade. The average daily volume for Ethereum Classic, Ethereum and Bitcoin was low as of late afternoon, indicating traders were not exiting their positions en masse which is a good sign for the bulls.

On Tuesday, Ethereum Classic’s RSI dropped down to the 65% level and was settling into two bullish patterns while holding above support at $65.10

See Also: Ethereum Already ‘Flipped’ Bitcoin In This Part Of The World

The Ethereum Classic Chart: On Aug. 7, Ethereum Classic broke up bullishly from a symmetrical triangle the crypto had been trading in since around June 1. Ethereum Classic then traded sideways for five days to consolidate the move higher. Ethereum shot up almost 30% and has spent the past two days consolidating the move.

The most recent rise followed by consolidation has helped Ethereum Classic to form a bull flag pattern on the daily chart with the pole created between Aug. 13 and 15 and the flag on Monday and Tuesday. If Ethereum Classic breaks up bullishly from the flag pattern it has the potential to soar another 30% higher from the lowest point in the flag pattern, which could cause the crypto to reach $86.50.

Ethereum is also trading in a bullish rounded bottom pattern indicating higher prices may come in the future. The rounded bottom pattern began with a decline in price beginning on May 28 and was eventually followed by a curl back north on July 20.

See Also: Bitcoin vs Ethereum • What’s the Difference?

Story continues

Ethereum Classic is trading above the eight-day and 21-day exponential moving averages with the eight-day EMA trending above the 21-day, both which are bullish indicators. The crypto is also trading over 65% above the 200-day simple moving average indicating overall sentiment is bullish.

Bulls want to see continued consolidation within the flag before big bullish volume comes in and breaks Ethereum Classic up bullishly from the pattern. If it breaks up from the flag it has resistance above the $72 and $79 levels.

Bears want to see big bearish volume come in and push Ethereum Classic down below the eight-day EMA which would invalidate the bull flag. If the crypto loses support at $65.10 it could revisit lower support near $57.

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Image: Ethereum Classic

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Ethereum ‘liquidity crisis’ could see new ETH all-time high before Bitcoin — Analyst

Ethereum‘s native token, Ether (ETH), may beat Bitcoin (BTC) to new all-time highs, fresh analysis reveals.

In a tweet on Wednesday, Ki Young Ju, CEO of on-chain analytics service CryptoQuant, highlighted a “sell-side liquidity crisis” that could yet give ETH the edge over BTC.

Ether liquidity shortfall “intensifying”

With Bitcoin up over 50% versus its lows of $29,000, altcoins have also begun to reawaken, with Ether as no exception.

The largest altcoin has recaptured $3,000, a level that, this week, is now in the process of being retested as support.

Despite attention focusing on Bitcoin reclaiming $50,000, optimism over Ether remains high after its successful London hard fork deployment earlier this month.

Thanks in part to the supply changes pushed through via the hard fork, a liquidity shortfall could ultimately serve to push ETH/USD to new historic peaks before BTC/USD manages to do the same.

“$ETH might reach its all-time high earlier than $BTC in the long term,” Ki summarized.

“Current $ETH price is closer to ATH compared to $BTC. Higher demand, lower supply. $ETH sell-side liquidity crisis still intensifies, while $BTC exchange reserve stopped its downward trend in May.”

BTC exchange reserve chart. Source: CryptoQuant

In terms of numbers, Bitcoin exchange reserves have been declining since May, only to return in late July. From a peak of 2.54 million on July 26, BTC reserves then declined to 2.44 million this week.

By contrast, ETH has seen a mostly linear downtrend since late May’s local high of 21.43 million held on exchanges. As of this week, the exchange balance is around 19.25 million.

ETH exchange reserve chart. Source: CryptoQuant

Battle of the supply shocks

Ki is not alone in forecasting a more rampant bull charge for Ether compared to Bitcoin.

Related: Analysts say this key metric suggests an altcoin season is at hand

As Cointelegraph reported, Bloomberg Intelligence has also come out favoring ETH over BTC in a recent report, even forecasting a “flippening” of the largest cryptocurrency.

Meanwhile, data continues to show a supply shock underway for Bitcoin as well — something that has its own historical precedent for sparking BTC price run-ups.

“Illiquid Supply Shock ratio has been a good leading indicator over the past few months,” analyst William Clemente III commented on the latest figures from fellow on-chain analytics resource Glassnode.

“Impulses in both directions have resulted in price action following. As the metric continues to grind slowly upward, currently at levels prev. 58K BTC, watching for another major impulse.”

Bitcoin supply shock annotated chart. Source: William Clemente III/Twitter

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.