For the second time in crypto history, Ethereum (ETH) just surpassed Bitcoin (BTC) in percentage of long-term holders. This crucial move demonstrates investors’ growing confidence in the future of the Ethereum network. Let us examine the reasons for this promising development.
Ethereum holders more loyal than Bitcoin holders
This new dominance of Ethereum confirms the trend observed in recent months of a growing share of long-term holders, despite a sluggish market. According to U.Todayinvestors continue to accumulate ether, convinced of the potential of Ethereum.
Several factors motivate this sustained interest. First of all, the rapid development of the network is promising. The migration to Proof-Of-Stake and the advent of Layer 2 solutions are increasing confidence in the network’s ability to scale.
Furthermore, the Ethereum ecosystem continues to welcome innovative projects in DeFi, NFTs or the metaverse, attracting new users. This virtuous dynamic encourages long-term investment.
Above all, many believe that Ethereum has not yet expressed its full potential, unlike Bitcoin which is already mature. While the latter started 2024 in thunderous fashion, Ethereum is still trampling 50% below its record. A clear opportunity for certain patient investors, convinced of massive gains in the long term.
These attractive long-term prospects motivate a growing number of holders to keep their tokens for several years.
Risks to watch out for
While overall good news for Ethereum, this growing loyalty also presents a short-term risk. Indeed, a larger portion of the ETH supply that becomes locked in the very long term can reduce available liquidity and harm price dynamics.
For now, this does not appear to be a problem, with sentiment remaining positive for Ethereum. But this potential excess will need to be monitored in the future.
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