Bitcoin and Ether have garnered a lot of attention this year due to explosive surge in prices as also extreme volatility. Ether or etherum had surged to about $400 in June, up almost 5,000% from $8 in January.
This week, it fell to below $200, down more than 50% from the recent high but still up more than 2,000% year-to-date. Bitcoin, on the other hand, is up about 125% this year.
While bitcoin is arguably better known, ether is fast catching up. At this pace of growth, ether, which was founded just about two years back, could become the dominant digital currency in the world in the coming months.
There are several reasons for ether’s rising popularity. Ongoing feud among bitcoin developers, miners and technical experts over how to expand its processing capacity in order to meet increased demand has also led many investors to ethereum.
The bitcoin network currently imposes a limit of seven transactions per second, which has slowed trading and resulted in higher fees. Some believe that bitcoin would eventually be split into two forms.
According to a recent survey of digital currency users, 94% of the respondents were positive about the state of ethereum, versus only 49% positive about bitcoin.
Per Coindesk, some of the negativity toward bitcoin results from surge in the transaction fees and long processing times. Another reason was many users view bitcoin as less of a digital currency and more of a digital gold or store of value, whereas they believe that ether could function as a currency.
Bitcoin’s reputation has also been hurt by recent global cyberattacks where ransom was demanded in bitcoin.
Ethereum has won approval from some of finance and tech giants like JPMorgan Chase (JPM – Free Report) , Microsoft (MSFT – Free Report) and IBM (IBM – Free Report) , which have teamed up with many other companies to form the Enterprise Ethereum Alliance, which will develop standards and technology for ethereum blockchain.
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