Goldman Sachs: Ethereum plans to overtake Bitcoin as cryptocurrency market dominance

Goldman Sachs predicts that Ethereum will shatter Bitcoin's first-mover advantage by accelerating and advancing technology on NFTs and DeFi.

Goldman Sachs sees the potential for Ethereum to replace Bitcoin as the primary cryptocurrency, including factors such as virtualization, user base, and the cost of iteration of the technology.

In terms of market movement, Goldman Sachs said the main difference between the current cryptocurrency market and the 2017-2018 bull market is investor input.However, with the recent slowdown in investor engagement (reduction in cryptocurrency ETFs) and the growth of altcoins, the market is once again driven by business investors.

Goldman Sachs said relocating these schools to retail stores poses a risk to the market.Now, market volatility will continue until cryptocurrencies are able to use real financial value for money.

Ethereum has enormous potential

Goldman Sachs said the Ethereum system supports smart contracts and gives developers the ability to develop new applications.Most of today's financial fraud (DeFi) applications are developed through the Ethereum network, and most non-fungible tokens (NFTs) have adopted Ethereum as well.

Compared to Bitcoin, Ethereum has a larger trading volume.As Ethereum has already been widely used in DeFi and NFT, Ethereum is likely to become the most efficient in crypto applications.

Goldman Sachs added that Ethereum can secure and store all data on the distribution list.This information can be tokenized and exchanged. This means that the Ethereum platform has the potential to become a huge market for trusted data.

Buyers are likely to call whatever seems appropriate, if there are only a few.

Goldman Sachs believes that in the future, individuals will be able to collect medical data from Ethereum and sell it to research-based pharmaceutical companies.Ethereum's digital data will contain personal information, including assets, medical information, and intellectual property.

Ethereum also has the advantage of being a global consumer.Unlike intermediary servers like Amazon or Microsoft, this can provide a solution for sharing personal information.

Bitcoin's insufficiency not enough to support its role as a valued exchange

The main reason the market uses Bitcoin as a value retailer is its limited resources.But Goldman believes it's demand, not scarcity, that makes it successful as a retail asset.

The market now has a stable market capitalization at a significant value to hold assets. Although gold products have grown at a rate of almost 2% over the centuries, gold remains a profitable commodity. And rare materials like osmium are not bought in stores.

Goldman added that the stable and tight supply can boost the product market, making new customers more competitive than existing customers, raising prices and creating a financial bubble.Reducing the rapid growth and inefficiency of new equipment is more important than controlling costs with limited equipment. Currently, there is no coverage for all Ethereum devices, but there is a limit to the annual production increase to reach this indicator.

Rapidly changing technology is undermining the first mover of kom zoo dua.

Support the idea that Bitcoin would become the leader in the cryptocurrency market if Bitcoin had the best engine and the big users.

However, Goldman Sachs notes that history has proven difficult to occupy a pre-entry-first position in an industry where technology is changing rapidly and demand is increasing.If a president fails to negotiate consumer preferences or technology upgrades from his competitors, he could lose his edge (Yahoo VS Google).

Currently, the total number of active users in the cryptocurrency market is unchanged.In this environment, encryption technology changes rapidly at the same time, and systems that cannot be changed quickly can become obsolete.

In terms of user base, Ethereum gained a large active user base in 2017, with its current user base reaching 80% the size of Bitcoin.

By the way, Ethereum is rapidly reorganizing its process (which is faster than Bitcoin), from Proof of Function (PoW) to Proof of Stake Trust (PoS).

Goldman Sachs claims that PoS has the benefit of improving the working power of the system and rewarding miners based on how much Ether they choose to hold (rather than potency).

Currently, the energy consumption of Bitcoin has reached the whole of the Netherlands, and the energy consumption can be doubled if the value of Bitcoin reaches $ 100,000.This makes investing in Bitcoin difficult from an ESG perspective.

Goldman Sachs said that in terms of safety and security, all cryptocurrencies are still in their infancy due to rapid changes and unstable users.

While there are security concerns in the Ethereum PoS protocol authentication process, even Bitcoin is not 100% secure.Currently, the four major Bitcoin mining pools control almost 60% of Bitcoin's resources, and excessive concentrations increase the potential for fraud.

Ethereum still faces many dangers and its management is not guaranteed. For example, a delayed upgrade to Ethereum 2.0 could allow developers to switch to competing platforms.

The market will continue to change until the real cost occurs.

Goldman noted that the main difference between the current cryptocurrency market and the 2017-2018 bull market is the presence of investors.This is a sign that the financial industry has started to accept crypto assets.

Bitcoin's volatility was high as its value fell 30% weekly over the past week.

Meanwhile, business involvement has been slow of late.(reduced access to cryptocurrency ETFs);The rise of altcoins indicates that the market is once again pulled by the trader.

Goldman Sachs believes that this shift from companies to investors increases the risk of market failure.Now, market volatility will continue until cryptocurrencies are able to use real financial value for money. This will lead to a new era of cryptocurrency.