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Ethereum's Leap Forward: Outshining Bitcoin in the Crypto Race

Ethereum's Leap Forward: Outshining Bitcoin in the Crypto Race

Key Takeaways

  • Ethereum's 33% gain since the start of the year is attributed to more than just ETF speculation.
  • The adoption of a proof-of-stake model and the strategic immobilization of Ethereum contribute to its limited supply and heightened demand.
  • Future enhancements to Ethereum's network and regulatory clarity are poised to further solidify its position and value in the cryptocurrency market.

Ethereum has outpaced Bitcoin for reasons beyond the possible approval of spot Ether exchange-traded fund (ETF), explain Bernstein analysts Gautam Chhugani and Mahika Sapra in a report.

This is marked by Ethereum achieving a 33% increase in value since the year's onset.

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The report anticipates further growth in the Ethereum ecosystem, driven by clearer token regulations and innovations in token economic designs.

An additional factor is the upcoming Dencun upgrade scheduled for March 13, which is promised to significantly reduce fees in Ethereum Layer-2 networks and improve their profitability.

Central to Ethereum's success is its transition from Proof-of-Work to Proof-of-Stake. The analysts emphasize that the supply of Ethereum has remained stable since this pivotal change.

The report also highlights the decreasing presence of Ethereum on crypto exchanges, now at a record low of 11%, indicating a trend where more Ethereum is being locked up.

The analysts point out:

With the growth of ETH transaction fees based on higher blockchain activity, more ETH holders are incentivized to stake their ETH.

Moreover, the emergence of new protocols like EigenLayer, facilitating the restaking of Ethereum, has also played a role by introducing new tokens and services, thereby attracting additional staking demand.

These developments have created a robust foundation for Ethereum, indicating a promising future for its holders and the broader cryptocurrency market.

In other news surrounding Ethereum, its value recently exceeded $3,000 for the first time since April 2022.

Aaron S., Editor-In-Chief
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.
Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.
Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.

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