There’s Bitcoin and there are altcoins. For most of the history of the cryptocurrency industry, BTC has been separated from its spawn. While Bitcoin shares a vision and ethos of other projects, like Litecoin and Decred, it has acted differently than its counterparts on the lower rungs of the cryptocurrency ladder.
According to a recent report from the San Francisco Open Exchange (SFOX), it may be time for Ethereum to leave the class of altcoins, maybe to join Bitcoin as a non-altcoin or to become its own category in and of itself.
More Bitcoin-Like Than Altcoin-Like
In a recent study, the exchange’s researchers determined that Bitcoin’s current correlation with Ethereum is “markedly higher” than its correlations with other assets commonly thrown into the altcoin bucket.
They add that the market has been this way for much of July. Just looking at today’s price action, this seems to be somewhat of the case. As of the time of writing this, BTC has posted a 1.7% daily performance while ETH has appreciated by 2%.
SFOX suggests that this trend “may support the idea that Etheruem is coming into its own as a blockchain”, and is thus starting to be acknowledged as its own project, not just another one of the projects among the sea of altcoins. The researchers continue:
“If this trend continues, it may become inappropriate to categorize Ethereum as an “altcoin” on a par with other cryptoassets that are not Bitcoin. As the crypto sector continues to evolve and further garner public attention, it stands to reason that prominent projects besides Bitcoin will come to be understood and evaluated on their own terms.”
Institutional and Corporate Acknowledgement
Ethereum is also starting to be recognized as institutional investors and corporates alike, albeit at a slower pace than the market leader.
Recently, The Block reported that the CME may soon be launching an Ethereum trading vehicle. They suggest that the CME altering its reference rate and index for Ethereum could mean that futures are coming.
An industry source told the outlet that this change is being done to “prep for an Ether” vehicle. If the exchange goes ahead with its plan, Ethereum would be the only other cryptocurrency besides Bitcoin to have its own institutionally-accessible, US-regulated futures market.
Also, with the rumors about brokerages foraying into offering cryptocurrency projects, Ethereum is almost always mentioned as the asset aside from Bitcoin that firms intend to support.
Case in point, the rumors regarding E*Trade delving into spot cryptocurrency tradings specifically mentioned Bitcoin and Ethereum. This in itself arguably says a lot about where the project has come, and how it has differentiated itself from its former ilk.
And, who could forget massive companies working with Ethereum technology? Microsoft, Ernst & Young, JP Morgan are among the prominent Fortune 500 companies that are putting Ethereum to good use.
Ethereum Apps are Doing Great
What’s more, the applications based on the blockchain — which are one of the key differences between Bitcoin and Ethereum — have purportedly begun to gain traction at a rapid pace, showing that so-called “dApps” are much more than a passing fad.
Per Binance Research, the amount of value locked up in Ethereum’s decentralized finance applications has surmounted $500 million. This collateral is currently funding a rapidly-growing ecosystem of decentralized loans, stablecoins, and other products.
Decentralized Finance has steadily gained adoption since a year ago, with around 500 million $USD locked across all #DeFi products. @MakerDAO remains the largest with a whopping 290.1 million USD locked in value.
Are we finally starting to see adoption from traditional finance? pic.twitter.com/c2JYy1wHpb
— Binance Research (@BinanceResearch) July 24, 2019
Also, decentralized exchanges, best known as DEXs, have seen a growing level of adoption.
As found by Totle in a recent analysis, this form of exchange has seen volumes triple since January 2019. With DEXs being one of Ethereum’s primary use cases at the moment, this statistic has been seen as a relatively positive sign.
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