While you are focusing your attention on Bitcoin (BTC) for now, and why not, it would be a good idea to look at Ethereum (ETH) which is doing just as well. Earlier today, Ethereum (ETH) broke through the crucial $ 700 levels. At the time of going to press, ETH is trading at $ 701 with a market cap of $ 79 billion.
As CoinGape reported yesterday, 2021 could be the year for Ethereum investors with an increase in institutional ETH purchases. Additionally, given that ETH is trading 50% off its all-time high, there is enough room for it to catch up with BTC. Looking at these metrics, ETH might be the best risk / reward for investors at this point.
At its current price of $ 710, investors can still buy $ ETH for more than 50% on its old ATH.
Considering (1) the historical correlation between BTC and ETH and (2) how BTC has already exceeded its ATH, this is arguably the best risk-reward in crypto right now.
– Spencer Noon (@spencernoon) December 28, 2020
On the other hand, if we even look at the charts, Ethereum continues to hit higher highs and lows. With the new highs, ETH has received crucial support with every upward move.
$ ETH (USD)
Endless series of higher highs and higher lows, with the most recent low confirmed by a new high.
I consider this model to be the “Stairway To Heaven”. pic.twitter.com/sZM2m9ts0w
– The wolf of all the streets (@scottmelker) December 27, 2020
Also, after BTC’s massive bull run over the past three days, the ETH / BTC pair has entered oversold territory. It is currently at crucial resistance and hints at an upcoming bullish divergence.
Nice oversold bullish divergence and pop. Now is the time to be careful – the pair is at key resistance. pic.twitter.com/L0qswHz2Lv
– The wolf of all the streets (@scottmelker) December 27, 2020
Institutions will soon turn to DeFi
One of Ethereum’s greatest strongholds is that the blockchain has hosted some of the largest decentralized finance (DeFi) applications. Ethereum currently controls over 70% of DeFi business. Due to the DeFi mania in the summer of 2020, ETH also remains the most traded crypto asset of the year.
Crypto market expert Alex Krüger believes institutions will eventually turn to DeFi. He writes:
“Institutional investors will eventually turn their eyes to DeFi. Not yet. But it’s a matter of when, not if. The prices will then go up so much, you will all be incredulous. But don’t see that happening in 2021. Need more regulatory clarity ”.
So, just when you are enjoying the wild ride of Bitcoin (BTC), you probably won’t want to miss the Ethereum opportunity as well.
To follow DeFi updates in real time, check out our DeFi news feed here.
