In April, the price of Ethereum rose 41%, while the price of Bitcoin fell 8%. Experts at JPMorgan believe the trend may continue, Business Insider reports .
In a note to investors, bank analysts highlighted the difference between assets. In their opinion, the first cryptocurrency is more perceived as a store of value and competes with gold, while Ethereum is the backbone of cryptoeconomics and functions as a unit of exchange.
“To the extent that owning this share of activity is more valuable, the theory is that Ethereum should outperform Bitcoin in the long run,” JPMorgan said.
The bank’s specialists see three reasons why ether has outpaced the first cryptocurrency in terms of profitability in recent weeks.
More stable liquidity
Last week, the liquidity shock that hit the derivatives market hit the entire cryptocurrency market, but bitcoin suffered more than its main competitor.
“Against this backdrop, more impressive is the sharp recovery in the depth of the Ethereum market, which on some exchanges is greater than before the recent liquidity shock,” the bank said.
Less reliance on derivatives markets
In a market with significantly higher spot turnover, the underlying long-term position (in Ethereum) is less dependent on leverage in the form of futures or swaps.
Stronger Demand Base
The Ethereum network has long been characterized by higher transaction rates on the public blockchain than Bitcoin. This is likely due to increased activity in DeFi and other sectors, according to JP Morgan experts.
According to some estimates, 11% of the Ethereum emission was attributed to highly liquid coins over the past month, while for bitcoin this figure was 4%.
Recall that analysts at the Kraken exchange allowed the Ethereum price to rise to $ 15,000, while Bitcoin, in their opinion, will less than double.