Ethereum outperforms Live Bitcoin. Despite being seven years younger than its predecessor, Altcoin has had many successes in the market and has a higher return on investment than Bitcoin. This is because Ethereum became mainstream and continued with three-digit outperformance until the end of 2021.
Ethereum is better than Bitcoin
2021 was the year when many cryptocurrencies in the market hit record highs. Bitcoin and Ethereum investors have also benefited significantly from these rallies, where each digital asset has grown by at least 100% at some point in the year. However, Ethereum has been far more successful than Bitcoin when measured by the performance of both digital assets of the year.
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Altcoin has experienced a multi-year range of breakouts with the ETHBTC pair and has established itself as one of the general trends of the year. Every year, Ethereum has risen almost 500% this year. By comparison, Bitcoin increased at a rate of about 95% over the same period.
ETH outperforms bitcoin by 400% in 2021 | Source: Arcane Research
For both digital assets, this shows the biggest performance gap in five years, dating back to 2015, when ETH was first launched. Since then, ETH has proven to be a valued force in the crypto market, and its consistent outperformance has been a major factor behind investor adoption.
However, despite its performance compared to Bitcoin, it is far behind in terms of market capitalization. Currently, Bitcoin boasts a market capitalization of about $ 1 trillion, but ETH still has a market capitalization of about $ 490 billion.
Layer 1 wins in 2021
Ethereum is not the only cryptocurrency to record significant outperformance of its predecessor. Ethereum is still one of the most popular layers 1, but there are other layers that outperform Ethereum. These Layer 1 protocols have grown significantly this year, especially with the rise of decentralized finance (DeFi) and NFTs.
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Networks such as Solana, Avalanche, Terra Luna, Fantom and Harmony have all been incredibly successful years. These Layer 1 protocols have come up against the big guys and nevertheless. All of these networks performed so well that they slowed down Ethereum’s performance.
Layer 1 protocols outperform ETH | Source: Arcane Research
Over the course of the year, they have all gained significant market share from Ethereum and are expected to continue to do so next year. They are growing in terms of the amount of locks on users and networks, and that trend is unlikely to disappear soon.
The native tokens of these networks have also grown with the adoption of the protocol. It pushed prices to record highs and performance figures, indicating that Layer 1 actually won in 2021.
ETH dips to $3,700 price range | Source: ETHUSD on TradingView.com
Featured image from Cointribune, charts from Arcane Research and TradingView.com
