Bitcoin commanded the crypto conversation this week, riding momentum from PayPal's announcement that it would support the cryptocurrency as a payment method. Prices surged. Bitcoin cleared $13,000 aft
Bitcoin commanded the crypto conversation this week, riding momentum from PayPal's announcement that it would support the cryptocurrency as a payment method. Prices surged. Bitcoin cleared $13,000 after hitting $13,200 on the week, marking a new 2020 high.
Ethereum remained sidelined. The token gained over 4% from its $380 opening, touching $400 before retreating. This limited movement masks what happened over longer periods. ETH has outperformed Bitcoin by a factor of two when measured across extended timeframes.
Both cryptocurrencies sit at different distances from their historic peaks. Ethereum trades about 70% below its all-time high. Bitcoin stands only 35% away from its record.
Vitalik Buterin, Ethereum's founder, has articulated a different view of the network's role. Ethereum operates as more than a hedge against failing fiat currencies. The network functions as a complete financial ecosystem, he contends. After five years of development, ETH merits classification beyond the altcoin label.
The numbers from DeFi show the shift. Nine million ETH—8% of the maximum supply—sits locked in decentralized finance protocols. Since January, that amount has climbed more than 200%. Bitcoin and Ethereum holders use the two assets differently. Bitcoin holders maintain their coins in cold storage. Ethereum holders deploy theirs to earn additional returns and stake for rewards.
Institutional investors have taken notice. Grayscale and other funds have begun accumulating ETH because they see it as undervalued relative to its potential. DeFi has been the primary force driving ETH prices this year. The same element powered prices three years ago, when initial coin offerings dominated investor attention.
Ethereum 2.0 represents the next potential catalyst for prices. Observers expect the upgrade's arrival could advance values higher in the coming months.
