Three Reasons why Ethereum could have a Better Run than Bitcoin in 2021

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In the past year, Ethereum had a better run compared to bitcoin. Ethereum value surged by 1,272 percent, while that of bitcoin was high by 806 percent in March 2020. Investors should watch the lesser-known crypto, and the trends below could explain why the performance of Ethereum could become much higher this year.

(a) Visa Adoption

Visa, a world-renown payment giant, has announced plans of adopting cryptocurrency in settling transactions. The company has partnered with Crypto.com to start a settlement layer based on the Ethereum network.

Given that the visa network is one of the world’s largest platforms, many transactions will be shifted to the Ethereum network if the pilot program becomes successful. As the usage increase, the value of Ethereum will also skyrocket. This is one way this blockchain can be useful.

(b) Non-fungible token (NFTs)

NFTs are based on the Ethereum network, though they are easy to create digital pieces of art. They are just like trading cards or limited edition books and can be bought, stored, or sold like digital collectibles.

The NBA adopted the NFTs in 2020 to create TopShots and buy and sell live games moments. NFTs are becoming mainstream, and if the trend continues, the Ethereum network could be the foundation of a new industry worth billions of dollars. As the demand for this cryptocurrency continues, developers will cut the supply drastically.

(c) Supply Cut

Ethereum Improvement Proposal (EIP) 1559 will upgrade the system to lower the transaction costs. This upgrade will see a low and flat fee maintained for activities on the network. If implemented, the upgrade will see the value of ETH increase. Then the demand and the supply factors will see ETH goes up in the coming months.

How to Purchase ETH

For Canadian investors, can be purchased ETH directly to their portfolio via brokerages such as WealthSimple. Ether Fund (TSX: QETHU) is the best option for Canadians who want to hold crypto in a tax-free saving account or a Registered Retirement Savings Plan (RRSP). This is an easier way to save funds without the complexities of cold storage, transaction fees, or crypto tax implications.

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