In today’s bitcoin and cryptocurrency news, learn about the situation of Bitcoin and Ether. When January 2021 rolled around, Bitcoin controlled 72% of the market and Ether held only 10%. Meanwhile, switching from a proof-of-work blockchain to a proof-of-stake one is meant to solve problems with high traffic and transaction costs by consuming less energy. Finally, even if “the Merge” is rapidly approaching, Bitcoin is still performing better than Ethereum. Despite the second largest update ever scheduled for the second largest blockchain, Ethereum has been falling behind Bitcoin in recent days.
Bitcoin is being chased by Ether in the quest for the digital throne
Original Source: Cryptoverse: Ether snaps at bitcoin’s heels in race for crypto crown
Years ago, ether couldn’t challenge bitcoin. Its goals may be more realistic now.
The second-biggest cryptocurrency is gaining market share from bitcoin ahead of a “Merge” software patch that might lower Ethereum’s energy usage if developers succeed.
Bitcoin’s market share has fallen to 39.1% from 47.5% in mid-June, according to CoinMarketCap. Ether’s price rose to 20.5% from 16%.
The upstart is still far from conquering bitcoin, a reversal known as “the flippening.” Bitcoin was 72% of the market in January 2021, while ether was just 10%.
As for pricing, one ether is presently worth 0.082 bitcoin, around December 2021 highs and above the 2022 low of 0.049 in June.
People regard Ethereum as a safe asset because of the network’s success, says Joseph Edwards, head of financial strategy at Solrise Finance.
“How Ethereum is seen in crypto is permanent.”
The Merge, scheduled on Thursday after multiple delays, might lead to increased use of the blockchain, potentially boosting ether’s price. However, nothing is definite in the volatile cryptocurrency market. read
Ethereum represents the backbone of the “Web3” vision of an internet where crypto takes center stage, powering services such as decentralized finance and non-fungible tokens. This much-hyped utopia is yet unrealised.
Bitcoin and ether have virtually halved this year on central bank rate hike fears. Ether is up almost 65% since June, so investors appear to enjoy the Merge. Bitcoin has barely moved in that time.
“We’ll see (ether’s) appeal to energy-conscious investors,” said Doug Schwenk, CEO of Digital Asset Research, but he cautioned that ether was far behind bitcoin.
WEAK KING
Bitcoin’s declining dominance in crypto’s current bear market is a divergence from prior market cycles, when investors dumped “altcoins” in favor of bitcoin.
To dethrone a king is no easy task.
Bitcoin is the most popular crypto. Mainstream investors that entered the crypto market since 2020 have favored bitcoin, the most liquid and widely traded asset.
The original digital coin’s $427 billion market worth is more than double Ether’s $210 billion, and market participants feel its limited supply makes it the gold standard in crypto.
Some market players argue bitcoin’s grip on the crypto crown is still firm, even with rivals. Hugo Xavier, CEO of K2 Trading Partners, said its dominance could rise to 50%-60% if the crypto market goes positive, but it won’t reach 70% again.
The Long-awaited Crypto Update’s Dangers Are Broken Down by Experts
Original Source: Ethereum Merge Explained: Experts break down the risks of the long-awaited crypto update
The Ethereum merge event is scheduled for Thursday, according to the Ethereum Foundation. Experts say it will lower the blockchain’s energy consumption by 99%.
The update will switch Ethereum from proof-of-work to proof-of-stake. The network will be able to execute transactions faster with lower gas fees.
Some have labeled the merge the most momentous crypto event since the launch of ether and bitcoin. Ethereum powers NFTs and smart contracts.
Ethereum cofounder Vitalik Buterin recently supported proof-of-stake protocols on Twitter, saying they might cut energy use by 99.5%.
Ari Redbord, TRM’s head of legal and government affairs, said the integration changes how Ethereum transactions are validated.
Proof-of-work verifies transactions through mining, but it’s energy-intensive. Proof-of-stake selects validators based on the “stake” they have in the blockchain, or how much of that currency has been committed.
Ethereum will split into smaller data blocks to allow speedier processing, bringing forth Ethereum 2.0, which aims to handle 100,000 transactions per second. Ethereum processes 30 transactions per second.
“Decentralized networks may run with reduced fixed costs and become more flexible for larger-scale solutions,” says Al Morris, co-founder of DeFi business Koii Network.
Dangers
Experts told Insider the merger’s outcome is unknown.
Safer transactions
Proof-of-work proponents say a tiny number of ether holders will eventually have outsized authority, while proof-of-stake proponents say increased control by investors would lead to a safer system.
Redbord, who monitors illicit digital asset activities, isn’t convinced if the change will improve chain safety.
Questionable
“One question is whether the new Stake-based model will attract as many node operators, as tokens must be acquired before being staked as collateral,” Morris noted.
He said staking might contribute to long-term price stability.
Rivals
The Ethereum blockchain will become faster and cheaper, although transactions may not speed up significantly compared to other, smaller networks.
Santiago Portela, CEO of FITCHIN, told Insider that alternative smart-chain blockchains are grabbing market share from Ethereum. “Look at Solana. It’s fast, inexpensive, and has actual user acceptance. NFT sales and transactions on Solana are now surpassing Ethereum’s.”
Institutional adoption
Bank of America said Friday the merger may boost institutional investment.
Analysts said the “substantial reduction” in energy utilization could allow traders to invest in proof-of-work currencies.
BofA said the integration is a forerunner to the Surge, a planned Ethereum upgrade to increase scalability and reduce gas fees.
Analysts say the event could boost Web3 adoption.
“Insurance firms invest their reserves in corporate and government debt instruments, but analogous risk/reward instruments in the digital asset ecosystem are difficult to identify or don’t exist,” BofA added.
Prior to the merger, Bitcoin is outperforming Ethereum
Original Source: Bitcoin Outpacing Ethereum Ahead of the Merge
Bitcoin has overtaken Ethereum in recent days, as the second blockchain prepares for its greatest update.
Strengthening Bitcoin
Bitcoin is still in the spotlight despite Ethereum’s Proof-of-Stake upgrade.
Bitcoin rose to $22,229 Monday. Ethereum costs $1,715 after a 3.3% drop. Second crypto’s slump occurs despite “the Merge” being closer and equities trading in the green to start the week (S&P 500 up 0.74, Dow Jones up 0.54, Nasdaq up 0.55).
Bitcoin has gained roughly 20% after breaking through $18,600 Wednesday. The monthly RSI displays a bullish divergence for the first time since September 2021.
After hitting a 2022 high of 0.085 on Wednesday, the ETH:BTC ratio has fallen. It’s down 9.2% to 0.077. The ratio hit 0.053 in June before ETH led a market-wide comeback; for ETH:BTC to return the bottom, it would have to fall another 33.45%. “The ratio” is the number of ETH needed to buy one BTC. One BTC is worth 13 ETH at 0.077.
According to TradingView, BTC’s overall market dominance has risen to 41.28 percent since bottoming at 39.79 percent.
Merging
Ethereum’s drop against Bitcoin comes despite its largest update.
This week, the blockchain will “merge” from Proof-of-Work to Proof-of-Stake, reducing energy consumption and ETH emissions by 99%. The Merge should ship on September 15, but ETH hasn’t reclaimed its August high of $2,015.
While the Merge will reduce ETH’s supply, it could become a “sell the news” event that leads to a selloff. BitMEX CEO Arthur Hayes said last week he was hopeful about how the Merge could boost ETH’s price, but it could suffer in the short term if investors sell on the news. Crypto occurrences are common. Bitcoin hit a months-long high of approximately $65,000 on April 14, 2021, when Coinbase held its IPO on Nasdaq. Elon Musk’s “Dogefather” prank on May 8, 2021, hurt Dogecoin. It hasn’t recovered.
Ethereum could be eclipsed by Bitcoin and the ratio between the top two crypto assets before its largest upgrade. If so, maybe there’s no “flipping” ahead.
Summary of today’s Bitcoin and Cryptocurrency news
To put it simply, even though it must tolerate rivals, some market participants claim that bitcoin still has a firm hold on the crypto crown. For instance, Hugo Xavier, CEO of K2 Trading Partners, stated that if the cryptocurrency market becomes positive, its dominance might increase to a range of 50%–60%, but it is unlikely to reach 70% again.
In addition, the “substantial reduction” in energy use, according to the firm’s analysts, could increase investor interest from traders who were previously forbidden from investing in tokens built on a proof-of-work architecture. Overall, analysts said the event could usher in more widespread adoption of the Web3 ecosystem.
Finally, Ethereum may find itself eclipsed before its greatest update ever due to the increasing dominance of Bitcoin and the rising ratio between the top two crypto assets. If that is the case, perhaps there won’t be any “flippening” after all.
