After the recent growth in the price of BTC, many are wondering if Ethereum may have some surprises in store for December and the start of 2024.
Amid a new-found euphoria of cryptocurrencies, memories come back vividly of the time when altcoins, led by Ethereum (ETH), broke out of Bitcoin’s (BTC) mega uptrend.
Faced with the current rise recorded by Bitcoin, many are wondering whether ETH will soon be able to gain capitalization shares again, overshadowing Bitcoin and recording unusual returns.
In this regard, it could be interesting to take into consideration past halvings as a point of reference to obtain a comparison and better understand the internal dynamics of the decentralized market. Does Ethereum (ETH) have the potential to overtake Bitcoin (BTC) in 2024 in terms of capital growth?
Bitcoin and Ethereum: what happened in past halvings?
Bitcoin has experienced three halving rallies (in 2012, 2016, and 2020) and has continued to solidify its position as the leading cryptocurrency by market capitalization. In 2012, after the first halving, BTC experienced an impressive increase, rising from a price of around $12 to over $200 over the next year. In 2016, the second halving marked the start of another growth cycle, taking the price from around $600 to over $3,000 over about a year. In 2020, during the third halving, Bitcoin surpassed previous all-time highs, reaching $64,000 in 2021.
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During Bitcoin’s halving rallies, Ethereum has often followed the same trend, showing proportional growth. In 2016, following Bitcoin’s second halving, Ethereum rose from around $10 to over $300 over the next year. In 2020, during Bitcoin’s third halving, Ethereum recorded notable growth, going from around $130 to over 1,400 in 2021, reaching $4800 at the end of the year.
- ETH/USD, 1W
- Source: TeleTrader
Why does Ethereum tend to outperform?
The growth of Ethereum has been driven by several key factors, but roughly speaking, the driving force behind the growth of ETH’s value has always been the whirlwind of innovation that the projects on its blockchain have imported. The emerging trend of DeFi in 2020 and NFT, not surprisingly, in 2021, has further consolidated Ethereum’s position as a versatile and dynamic platform, creating a strong inflow of capital, not only with speculative intent, but precisely economic, linked to the use of platforms linked to its Blockchain.
A factor that could once again attract the attention of investors in 2024 is also the transition to consensus PoS that has occurred in the last two years, which has improved the scalability, security, and sustainability of Ethereum. This process has significantly reduced the supply of ETH, fueling the bullish sentiment of many of its supporters.
Original article published on Money.it Italy 2023-12-08 09:50:00. Original title: Perché Ethereum può crescere più rapidamente del Bitcoin
