Ethereum is gearing up for a breakthrough year in 2024, according to market analysts. The native token of the market-leading Ethereum smart contract blockchain is poised to ride technical and regulatory catalysts to outpace Bitcoin’s gains this year.
TLDR
- Ether could launch in 2024 as the spot ETF narrative builds and major Ethereum upgrades like Dencun reduce fees.
- Ethereum remains the dominant platform for DeFi, NFTs, and smart contracts compared to its competitors.
- The upcoming Dencun upgrade aims to improve scalability and significantly reduce network congestion and fees.
- Institutions predict that ETH will outperform BTC in 2024, given Ethereum’s strength and additional revenue opportunities.
- Ethereum supply is deflationary due to fee burning, while BTC is experiencing inflation in 2023 due to new mining.
Chief among them is the Dencun upgrade, which is currently being tested. Dencun, scheduled to launch on Ethereum’s mainnet in the coming months, introduces a data structure that some experts predict could reduce network fees by up to 90%.
By improving scalability and throughput, Dencun aims to alleviate the congestion and high costs that hinder Ethereum adoption. When it comes to unlocking the platform’s true potential, the impact can be profound.
Especially beyond Dencun, Ethereum’s dominance continues to grow in areas like decentralized finance and NFTs. The total value locked in the Ethereum DeFi protocol is a whopping 13 times that of competing blockchains. And while Bitcoin, the darling of cryptocurrencies, has received more inflationary mining rewards over the past year, Ethereum’s fee burn has actually made ETH a deflationary asset.
This scarcity, combined with staking yields and increasing institutional demand, provides investors with a way to generate returns simply by holding ETH. No such incentive exists in the relatively static Bitcoin.
Speaking of institutions, comfort with etheric vehicles continues to increase. The hottest craze right now is centered around spot cryptocurrency ETFs that directly hold the tokens. Big fund managers like BlackRock and VanEck, who recently launched spot Bitcoin ETFs, have ETH fund proposals awaiting regulatory approval.
The mere prospect of direct Ethereum exposure to capitalize on investors who dislike self-management has already been derailed by last week’s attempted rally. Once SEC approval opens the floodgates, we expect eager capital to push ETH prices higher and help decisively flip the script on last year’s Bitcoin dominance.
Of course, as with any nascent technology, risks remain. But for cryptocurrency pioneers and institutions alike, Ethereum appears to be a smarter long-term bet compared to other blockchains vying for the throne. With groundbreaking upgrades released in months rather than years, 2024 will be the year ETH finally wakes up to realize its grand ambitions.
And skeptical Bitcoin maximalists may find themselves longing for the past as their Ethereum-centric vision of the future moves closer to reality. The high-stakes battle for blockchain supremacy is entering a new phase, and all arrows are pointing towards ETH market leadership through periods of abundance and drought.