Is there an opposition between Bitcoin and Ethereum?

Cryptocurrencies are sparking the interest of the general public. It is no longer a topic only for traders or experts in technology and finance. Considering this, Mariano Craiem, CTO and co-founder of SatoshiTango, shared with Cointelegraph en Español, an analysis in which he focuses on the current situation and contrasts what happens with Bitcoin and Ethereum.

For Craiem, there have been several phenomena that, in their own way, stimulate people’s curiosity to understand and enter this segment of investment and business, unknown to the general public until recently.

“On the one hand, the media are reporting a bull market situation that reminds us of what we experienced towards the end of 2017, when the price of the digital currency was very close to USD 20,000 per unit. The price of the cryptocurrency sank months later to less than $ 3,200, “he recalled.

“The event, at that time, was closely linked to the FOMO empire (fear of missing out,” fear of missing out “or” fear of missing something “), described as the anguish that some users of social networks present for fear of not finding out about information or events, apparently transcendental and that leads them compulsively to join, in this case buying and raising the price. The inverse of the FOMO, its other side, is the fear of being trapped in an investment that, at a certain moment, begins to look less spectacular and thus people stampede out of that asset, collapsing its price. The two ends of the same loop ”, he later detailed.

However, he opined that The present bull market has components that were not in 2017: “Although there are also elements of volatility that relate them, the entry of institutional funds to the acquisition of cryptocurrencies is putting limits on the drawing of a saw with pronounced peaks and valleys that they habitually exhibit the bubble experience of certain investment assets. After the record prices at the beginning of the year, above USD 34,000, the price of bitcoin saw a correction but in no way overshadowed the phenomenon, which continues to this day. ”

“The entry of the funds is characterized by longer-term positions, they do not appear in an in-and-out dynamic and do not seem willing to enter into maddening short sales but as an investment alternative. It is also verified, more as a refuge, as an expression of a need, in addition, to take crypto as means of payment for different types of transactions, which is related, among other things, to the transparency, immediacy and security of operations provided by the blockchain network. With the funds coming in, more dollars are now needed to move the market ”, added later.

He also cited the case of MicroStrategy, a company listed on the Nasdaq stock exchange, and found it very instructive. “I’d say more, it’s fascinating. With high exposure in bitcoin, its role has been evolving for some time with the price of the crypto ”, highlighted Craiem.

On the other hand, he clarified that, with the enumeration of all these phenomena, he only intends to give a context, in no way to attribute the ability to establish the efficient causes of the movement of prices. “Whoever wants to do it, is simply lying. Nobody knows exactly why or how much bitcoin is going to go up ”, he said.

“Yes it can be said, as long as There is also a background of extreme liquidity in the world determined by the stimulus packages prepared by the governments and central banks of the main global economies to rescue companies and individuals in the context of the coronavirus pandemic, “he said.

Then he said: “The inflationary nature of these bulk issues has as a counterpart the attempt by the states to establish new regulations on the movement of capital to contain the effects of devaluation and exchange rate instability caused by these exceptional measures. In this way, the concept of decentralized finance in the crypto world becomes more attractive for those who want to defend their savings and operations from arbitrary interference. ”

Also, for him, The other novelty came from the hand of Ethereum, an open source platform also based on the blockchain model and whose crypto, Ether (ETH) is the second largest cryptocurrency after bitcoin.

Then he stated: “Ethereum showed gains so far in 2021 around 120%, above Bitcoin’s 30%, and reached an all-time high of $ 1,576.7.”

Craiem specified: “Ethereum has benefits that other cryptocurrencies do not have. A distinctive aspect in its utility is the creation of smart contracts. These, being integrated into the platform, eliminate the need to require external software. Ethereum also serves to execute faster operations, since the transaction time of Ether is actually faster than that of other technologies. Finally, it can be used to create financial applications, with security and transparency, it also offers cryptographic security online to manage properties and contracts ”.

He also highlighted that “Ethereum is not a competitor to Bitcoin, although it may occasionally bite off a portion of its market.”

“I prefer to see them as complementary, in any case as a diversification of Bitcoin,” he added.

To conclude, he stated: “At SatoshiTango, we trade both, as well as DAI, USDC, Litecoin, Ripple and Bitcoin Cash, the other cryptos preferred by users of our platform. The crypto revolution in full swing has already caused, for example, that the operations of our users have increased six-fold so far this year and that we have tripled our staff of collaborators to meet all that demand ”.

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