Ethereum to Become the Main Asset for Investors in 2021

During the second half of 2020, we observed a growing interest in cryptocurrencies from institutional investors. However, all the attention was fixed on Bitcoin. However, Ethereum is a more attractive asset for investors.

Why should Ether become the “cryptocurrency of choice” for every investor?

Since March 2020, following the coronavirus-induced market crash, ETH has grown by 1,200%. Meanwhile, BTC has only grown around 700%.

Bitcoin’s price has hit $40,000, and of course, in this context, Ether’s rise to $1,400 doesn’t look all that impressive. But what is more significant for an investor: good numbers and highs of an asset or high income?

There are good reasons to believe that Ether will continue to rise in price in 2021 and bring more returns to investors than Bitcoin.

Demand amongst developers

Ethereum is the number one platform for developing blockchain projects and launching decentralized applications. Since 2018, when the initial coin offering bubble burst, the expansion of the blockchain startup market has slowed. Still, their total number continues to grow.

Increasing volume of transactions of Ethereum blockchain

During 2020, transactions worth more than $1 trillion were recorded on the Ethereum blockchain. These numbers exceed the transaction volume of payment giants like PayPal, which is used by more than 350 million users and has average volumes that typically don’t exceed $200 billion per quarter.

Also, each transaction generates network commissions paid in ETH. And as network growth rates remain high, we can confidently expect the continuation of ETH’s bullish trend. 

Development of the DeFi ecosystem

Despite BTC’s leadership in the cryptocurrency market, Ethereum remains the young leader of decentralized finance (DeFi) sector. Very popular in the summer of 2020, DeFi’s loan and staking projects continue to grow and attract new investment.

The total value locked on DeFi platforms since the beginning of 2020 has grown by almost 3,300%. It increased from $687 million to $23.2 billion. And Ethereum is the primary network for the creation and launch of most new DeFi projects and stablecoins.

In the summer of 2020, the DeFi market chaos nearly eroded institutional confidence in the potential of blockchain technology in the financial sector. Still, public companies continue to show interest in this new type of asset.

In the fall of 2020, it became known that xSigma, a subsidiary of ZK International, listed on Nasdaq, was working on developing DeFi services. It is preparing to launch a decentralized exchange for stablecoin trading.

It seems that other areas of the cryptocurrency industry are on the same page, and some are directly related to Ethereum.