In the world of cryptocurrencies, Bitcoin and Ethereum are the most popular and dominant tokens above all others. As of 31 Dec 2021, Bitcoin (39.62%) and Ethereum (19.32%) are contributing to more than half. 2021 was a volatile year for cryptocurrencies, but Ethereum and Bitcoin still delivered astonishing returns.
Source: https://www.tradingview.com/markets/cryptocurrencies/global-charts/
If you bought US$1,000 of Ethereum in early 2021, you would have gain 450% with the same units of Ethereum worth US$5,500
While Bitcoin is the most popular cryptocurrency, Ethereum trounced Bitcoin in 2021. Despite Bitcoin being the market leader and first mover, Ethereum appears to be a favorite for investors and developers, and it could potentially overtake Bitcoin in the future. Below are several reasons why I prefer Ethereum over Bitcoin.
1. Ethereum has greater utilities than Bitcoin
Bitcoin was first introduced by Satoshi Nakamoto, to be a decentralized currency. The promise of it is to not be controlled by government or financial institutions (like how they control fiat currencies). It has gained adoption as an investment or digital gold. The controlled supply for Bitcoin is 21 millions and 19 millions have already been mined (left with 2 millions to be mined or discovered by miners).
Ethereum on the other hand, is not as widely accepted by businesses as compared to Bitcoin, but it serves as the most important medium in the metaverse, NFTs, and de-fi applications. Ethereum became the medium in buying and selling of NFTs due to its blockchain technology that enables smart contracts. Ethereum was designed to support transactions whereas Bitcoin was introduced as alternative coins. Both serve different purposes, but Ethereum provides much more to unlock the uncertainties in the future.
2. Ethereum are gaining popularity among developers
In the tech world, developer interest is often an indicator of where technology will be going. The more developers join effort in one technology, the likelihood that it will become more widely accepted. As of 2021, the developers for Ethereum are 6 times more than Bitcoin. This was largely due to many possibilities of Ethereum Blockchain smart contracts.
With strong interest from many developers in Ethereum, we can foresee that it will be much more able to adapt to new applications. The Eth2 Upgrade will definitely be more sustainable and scalable.
3. Future of Crypto is driven by Ethereum
Bitcoin may be the most popular cryptocurrency at the moment, but Ethereum has few advantages that could edge on the competition. Ethereum is an open-source blockchain, and provides smart contracts. Open source blockchain allows developers to build new applications on the network.These applications could be NFTs, or even new cryptocurrencies.
If today’s internet (Facebook, Instagram, VR, AR) is considered Web 2.0, Ethereum and all of its decentralized applications could potentially be Web 3.0.
Bottom Line:
2021 is a year, once again shows that cryptocurrencies have applications far beyond ‘digital gold’ Bitcoin, and that trend will continue in 2022, especially NFTs gaining a lot more attention by the end of 2021. With more interest and adoption in these areas, Ethereum will benefit from it, making it a better choice over Bitcoin and very likely that it will outperform Bitcoin once again in 2022.