On Friday, Ether surpassed bitcoin in active addresses. This is a sign of waning demand for the largest cryptocurrency in the world as its counterpart grows in stature.
Bitinfocharts data shows that ethereum is leading with 757,859 active address, approximately 49,154 more than Bitcoin, which has 708,705. From its April peak of 1.01 million, the total number of active addresses in bitcoin has fallen 38%.
Justin d’Anethan from Eqonex’s sales team, said that bitcoin’s fall could have many causes. He noted that these include the massive sell-off of bitcoin in May and the decrease in hashing power caused by China’s crackdown on mining.
‘This, along with the rise in ethereum’s utility, would have contributed for ethereum to overtake bitcoin in terms of active addresses’, d’Anethan stated.
More than 90% of all bitcoin mining operations were closed by the Chinese ban. The 2022 upgrade of ethereum 2.0 does not need mining. However, Ether production was also affected.
As more people sell bitcoin, the slide in active addresses may indicate that there is less demand. The dip may also indicate that traders are waiting to purchase the cryptocurrency. Some market commentators believe that this is a bearish trend in cryptocurrency’s price.
Bitcoin’s price has dropped around 50% from its peak in April at $64,829 and is currently trading at $33,482 Friday morning. The ether token ether, which has fallen by 11% to $2,039 over the same time, is more than 50% off its record high of $4.380 in May.
Experts see ethereum to be poised for breaking out due to its ease-of-use token and flexibility of the technology that underpins the network. It is being used to create smart contracts and other applications that are difficult to alter.
Due to its mature ecosystem, ethereum has always been the platform of preference for building smart contracts. ethereum is the best platform for decentralizing applications,’ d’Anethan stated.
There are many apps that decentralize finance (or DeFi): from saving, lending, trading and asset management to insurance to creative media such as art and music with NFTs to gaming worlds.
Companies such as Compound and UniSwap have seen a high adoption rate for such decentralized finance applications, or DeFi. He explained that these apps are often built on ethereum which has increased the number of active addresses.
Insider was told by Lex Sokolin (head economist at ConsenSys), that Ethereum addresses allow people to become an economic agent in a virtual world.