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Is Ethereum Overtaking Bitcoin as the Top Digital Currency?

JP Buntinx | March 9, 2016 | 2:05 pm
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Is Ethereum Overtaking Bitcoin as the Top Digital Currency?

JP Buntinx | March 9, 2016 | 2:05 pm

With all of the attention on the Ethereum project right now, there are a fair few digital currency enthusiast who would love nothing more than to see this project overtake Bitcoin in every way. More importantly, when Ethereum reached the market cap threshold of US$1bn, a lot of people expected it to keep going, but the value started plummeting shortly afterwards. At the same time, the Bitcoin price dipped as well. Are these two concepts more alike than people want to admit?

Also read: Russian Startup Qiwi to Continue Bitcoin Development despite Regulatory Hurdles

Google Trends: Bitcoin Vs. Ethereum

It is not all that difficult to gauge interest about any topic in the world outside of the realm of the digital currency ecosystem. A large part of our society has no vested interest in either Bitcoin or Ethereum, but that doesn’t mean their interest isn’t piqued. Google Trends can tell an interesting story regarding what people search for, which also provides valuable insights as to which topic is more sought after in recent months. However, it is important to keep in mind Bitcoin has been around for a few more years compared to Ethereum.

In the screenshot below, we can see the Google Trends search results for the term “Ethereum” in the past twelve months. As is clearly visible, there has been a surge of interest ever since January of 2016 came around the corner, although there was an earlier bump around August and September of 2015 as well. Google Trends seems to indicate the number of searches for Ethereum keeps increasing, which is positive news for the project

NewsBTC_Ethereum Search Trends 12 months

When conducting the same search for Bitcoin on Google Trends, there is an entirely different pattern. First of all, the chart stays out way higher, simply because people have been Googling the term Bitcoin for many years now. Several peaks of sudden interest can be noted during November and December of 2015, but things have calmed down again ever since. In fact, very little has changed in the past twelve months when comparing the starting level with the cut-off point.

NewsBTC_Bitcoin Google Trends 12 Months

Bitcoin And Ethereum Price Chart Comparison

Taking the above information into consideration, it is well worth the time to look how the price charts of both currencies are behaving. Given the Google Trends increase over the past three months, we have taken both Bitcoin and Ethereum three-month price charts from CryptoCompare, and put them side by side. This gives a far better representation of the actual price, rather than looking at a BTC/ETH chart.

On the Bitcoin side of things, the past three months have seen several ups and downs, although more downs, unfortunately. The Bitcoin price was still well above US$460 by early December 2015, but things have started slipping ever since. A bottom was set shortly after the New Year when the Bitcoin price dropped to US$365.67. However, things have picked up again in recent weeks, and despite a dip recently, we are back at a value of roughly US$410 per BTC [at the time of writing].

NewsBTC_BTC USD Price Three Months

Ethereum price charts, on the other hand, look very different. In fact, users could say the only way is “up” for Ethereum, as there is a visible upward trend noticeable since early January of 2016. That being said, Ethereum has not been without price dips either, although the lost ground has been made up relatively fast. The price per Ether has gone up from US$0.843 on December 11, 2015 to US$10.15 [at the time of writing]. The question is whether or not this price momentum is sustainable in the long run.NewsBTC_Ethereum Price Chart 3 months

Is Bitcoin Volume Flowing into Ethereum?

That is one of the main questions a lot of people are wondering about. If the Bitcoin price goes down, and the Ethereum price goes up during that period, does that means there is a shift in trading volume? But if that would be the case, why isn’t the Ethereum price dropping when Bitcoin goes up again and investors flock back to their original investment strategy? Once again, the charts by Cryptocompare will provide interesting insights.

The CryptoCompare one-month Ethereum trading volume chart – in USD – tells us there has been a steady amount of funds invested over the past thirty days, with some exceptions. February 14,19,20,26,28, and 29 were all days with very little funds going into Ethereum. However, February 10, March 3,4,5, and 6 were rather good investment days for this project. The lowest amount of USD volume flowing into Ethereum in the past thirty days occurred on February 20th, as just US$13,675.44 was recorded across all exchanges.

NewsBTC_ETH USD Chart one month

Comparing this information to the Bitcoin trading volume chart – in USD as well – things look a bit different. Most of the days see a steady amount of funds invested in Bitcoin, although March 5th was an exceptionally good day. There seems to be an average of roughly US$80,000 flowing into Bitcoin every day, which is not bad at all.

NewsBTC_BTC USD Chart One Month

But in fairness, the USD market is not a good representation of the trading volume for Bitcoin, as the Chinese Yuan is the biggest currency in this regard. CryptoCompare provides us with those charts as well, and it is clear there is a lot more money flowing into Bitcoin over the past few days. In fact, the CNY trading value has almost doubled over the past week for some unknown reason.

NewsBTC_BTC CNYTrading Chart One Month

But what about Ethereum? Well, the biggest currency flowing into Ethereum is none other than Bitcoin, which accounts for 87.66% of all volume in the past month. Granted, there has been a small capital flight of Bitcoin into Ethereum during the first two weeks of February, but the volume has calmed down ever since. Slightly more BTC is exchanged for ETH over the past few days, correlating with the increased CNY investments in BTC. Perhaps the Chinese are buying Bitcoin to get Ethereum after all.

NewsBTC_ETH BTC Chart One Month

Source: Cryptocompare, Flickr

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