Is Ether Not as Popular as Bitcoin?
It appears Ethereum isn’t as popular as bitcoin or other cryptocurrencies.
The Same Ownership Cannot Be Seen
In a new report released by Bloomberg, only 376 people hold a third of all ether tokens. While Ethereum is widely revered for its blockchain network, which has hardcore smart contracts capabilities, the token itself is only in the hands of a small amount of people.
This suggests two things, the first being that the coin isn’t as popular as most other cryptocurrencies. A lot of people haven’t invested in ether or haven’t purchased tokens. They see it as a secondary coin that doesn’t possess as many strengths as major competitors.
The second option is that the coin has become somewhat exclusive over the years. Bitcoin, for the most part, is owned by several people across several nations. It’s the very definition of a decentralized token considering there are only 21 million in circulation. Ether, on the other hand, seems to boast concentrated ownership.
Perhaps it’s not that the coin is less popular than other coins; maybe it’s just too popular amongst a certain breed of people. They’ve worked hard to get their hands on as much ether as possible over the years, and now they’re having trouble sharing.
The report’s original statistics come from cryptocurrency analysis firm Chainalysis Inc. It reported that the people holding the ether in hand are “whales,” which are individuals that don’t trade, but simply hold onto large amounts of crypto, hoping it will spike in price. They also hold onto their assets through digital wallets, and don’t leave them on exchanges.
Kim Grauer is a senior economist at Chainalysis. She compared ether holdings to those of bitcoin. By comparison, roughly 448 people hold only 20 percent of bitcoin, so naturally, that asset is far more distributed. Grauer commented:
The majority of whales are not traders. They’re mostly holding.
In addition, Grauer noted that when an “ether whale” decides to move money onto an exchange, a much stronger effect is noted on the asset, and she’s seen significant change in the currency’s volatility. She also mentions that ether is largely affected by where investors’ heads are at. If sentiment is positive and trading is occurring regularly, ether tends to move higher.
The coin is also heavily dependent on where bitcoin goes. In the past, if bitcoin has moved high, ether has followed suit. If bitcoin has fallen, an ether drop is likely to occur.
Bullish Behavior for Ether and Bitcoin
Grauer further states:
We’re excited to bring the models that have been applied to the stock market to cryptocurrencies. It’s unfortunate this bull run didn’t happen a month ago to be part of our analysis.
At press time, bitcoin is still trading for more than $8,000, while ether has also improved greatly over the past few weeks.