Ethereum’s bright future threatens to end bitcoin’s reign in cryptocurrencies

Ethereum Reign Cryptocurrencies

There is much and more and more talk about the ethereum network and its effectiveness to implement smart contracts, make loans or other operations that are ‘self-carried out’ without the supervision of a third party. The usefulness of this network in which the token is massively ether used as a medium of exchange is the argument used by many analysts to predict the Sorpasso of ether to bitcoin the future. Although this still seems a bit distant, the truth is that some palpable movements that go in that direction are beginning to be seen.

The latest of them has been a leak that comes from the Bank of Israel. This monetary institute is working to test its own digital currency and in the tests they would be using the ethereum network as a platform or support, as a source from the central bank has leaked in information collected by the Bloomberg agency .

Ether rises more than 7% in the cryptocurrency market on Tuesday to surpass $2,150, while bitcoin bounces just over 3%. In the last seven days, ether has risen almost 15%, while bitcoin has risen 12%. Experts often highlight the enormous usefulness of the ethereum network.

In May, the central bank published a report concluding that a new digital payment system could have a positive impact on the economy by simplifying payment processes and providing greater security to both parties in a transaction.

The Bank of Israel is not the only institute planning to launch its own digital currency (CBDC). From Sweden to China they are working on their own digital currencies before the drastic decrease in the use of cash as a means of payment and the evolution of banknotes and coins threatens to change radically.

In addition, the emergence of cryptocurrencies such as bitcoin has added to the pressure on central banks to ensure they have a viable alternative before unregulated forms of payment gain weight in the market.

Ethereum Reign Bitcoin

A more efficient network

Another advantage that is often attributed to ether and its ethereum network is the more efficient operation of its network. The bitcoin network has a high consumption of electricity, even higher than in many countries. For now, something similar is happening to the ethereum network, but the future forecasts seem very promising.

Ethereum is going to change its system to one called ‘proof of stake’, which will consume 99.5% less. “The main solution to reduce the energy consumption of cryptocurrencies is to invest and make the transition to more energy-efficient mining and consensus mechanisms,” said Mauro Accurso, head of Business Development at the South Pole, in a statement to Europa Press.

Accurso has pointed out that there are already several blockchain networks with a much lower environmental impact per transaction and has defended that for those that continue to operate with traditional proof-of-work mechanisms of consensus and mining, the long-term solution is to “make sure that the energy they use comes entirely from renewable sources “.

It will not be the case of bitcoin

Eurocoinpay adviser, Herminio Fernández, agrees with what Accurso has indicated and has specified, in statements to Europa Press , that the ‘proof-of-stake’ mining does not consume so much electricity because “it does not need such powerful calculation units, they are computers almost normal. “

However, while many tokens are adapting to this proof of work, Fernández does not believe that will be the case for bitcoin. “The positive thing about this cryptocurrency is its extreme security and, for that, it needs a brutal computer network,” he stressed.

Simon Peters, an expert analyst in crypto assets at eToro, explains in a comment that this movement is already underway on the ethereum network, which is currently in an update process. 

Peters notes that the average commission per transaction on Ethereum has dropped to $2.15, the lowest since December 2020. During the crypto-asset run in May, average fees rose to nearly $70, but all have fallen. after the market correction.

“As the network moves toward upgrade 2.0, fees may drop further, despite taking years to fully implement. However, the upgrade will eventually make mining faster and cheaper, as well as enhancing green credentials. of ethereum”, assures this expert in cryptocurrencies.