In 2024, Ethereum could surpass Bitcoin in price growth, confident head of research at ETC Group André Dragoš said.
The fundamental basis will be technological advances and Ether’s unwavering position as the leading platform for smart contracts. The expert also noted that in 2023 the second-largest cryptocurrency lagged behind digital gold in price growth.
“ETH lagged BTC over the past 12 months. However, Ether could outperform Bitcoin in the next 12 months,” Dragoš stressed.
The report also states that Ethereum’s price growth will be aided by the ‘deflationary burn mechanism’, implemented in August 2021 through the London hard fork’s EIP-1559 implementation.
The reduction in the supply of coins combined with attractive staking yields staking could lead to the so-called flippening — Ethereum’s market capitalization surpassing Bitcoin’s.
“Traditional investors may regard staking income as akin to dividends on stocks,” the expert noted.
Dragoš added that since its inception in 2015, Ethereum has consistently outpaced Bitcoin in growth rates. The exception is 2023.
Coinbase researchers also anticipate Ether’s return to average performance levels in the coming year, taking into account the ‘relative discount’ to the price of digital gold.
As a hurdle to the recovery, experts cite relatively weak fundamentals for the second-largest cryptocurrency, including a decline in on-chain transaction activity in 2023. Unconvincing on-chain metrics “make Ether’s monthly deflationary supply pace inconsistent,” Coinbase says.
In the last 24 hours Ethereum rose 6.6% to $2,374, and Bitcoin rose 1.4% to $43,062. Seven-day figures are 8.4% and -1%, respectively, according to CoinGecko.
Earlier, Standard Chartered analyst Jeffrey Kendrick predicted Ethereum to reach $8,000 by the end of 2026.