By Tobi Loba
According to a leaked report by the investment bank Goldman Sachs, Ethereum (ETH), the second-largest cryptocurrency by market capitalization, is poised to beat the flagship digital currency, Bitcoin (BTC) as a store of value.
In the report, the United States banking corporation Goldman Sachs dubbed Ethereum (ETH) as an Amazon of Information, predicting its value will continue to surge until it dominates Bitcoin (BTC) and the crypto market as a whole.
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The Major Points
The report titled “Crypto: A New Asset Class?” was first shared on Twitter by Santiago Roel Santos, General Partner at ParaFi Capital.
According to Goldman Sachs Global Macro Research, the strongest argument of Bitcoin (BTC) as a store of value is its scarcity. Its limited supply and high adoption will continue to set Bitcoin as a store of value.
Ethereum (ETH) on the other hand continues to enlarge its coast for applications, creating what is regarded as the largest ecosystem.
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Going by the report, Ethereum provides developers a way to create new applications and most of the decentralized applications (DApps) are built on the Ethereum blockchain. “The greater number of transactions in ether vs bitcoin reflects this dominance,” the report stated.
Likewise, the boom of non-fungible tokens (NFTs) has contributed immensely to the expansion of the Ethereum network in terms of development.
“Given the important of real uses in determining the store of value, ether has a high chance of overtaking bitcoin as a dominant store of value.”
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The researchers believe that there will be a higher demand for Ethereum (ETH) than Bitcoin (BTC) in the future, due to the growth of the ecosystem, stating that the success of a store of value rests on demand more than scarcity.
“Ether beats bitcoin as a store of value. The Ethereum ecosystem…provides developers a way to create new apps. Most of DeFi apps are being built on Ethereum. The greater number of transactions in ether vs bitcoin reflects this dominance” – Goldman Sachs Global Macro Research pic.twitter.com/vNkQ1HlDYM
— SantΞago R Santos (@santiagoroel) May 22, 2021
Scalability and High Transaction Fees Issues Will Be Solved By Ethereum 2.0
Before the leaked report surfaced, many crypto pundits have been saying repeatedly that there are chances for Ethereum to beat Bitcoin in the future.
However, many are concerned about the current issues with the Ethereum network, such as scalability and high transaction fees. But the launch of Ethereum 2.0 is expected to proffer lasting solutions to the network issues.
The most recent bull run before the devastating crash has already spoken volumes of what could be expected in the future. Ethereum (ETH) was able to drastically reduce Bitcoin’s market dominance to relatively 40%, an outstanding performance attributed to the utility of the largest smart contract platform and its native token ETH.
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