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The Ethereum network surpassed Bitcoin in total transaction volume in 2022. While the largest asset by market capitalization managed to retain its dominance in online search interest and steady transaction
Experts compare large market cap cryptocurrencies in web3 like Bitcoin and Ethereum and conclude that ETH has a better underlying economic model, compared to other assets. Projects and protocols in Ethereum’s ecosystem with the token economics (real value) and right product market fit could add new features and earning opportunities and continue to garner interest from investors.
Ethereum network outperformed Bitcoin in total number of transactions on its blockchain in 2022. ETH network tackled 408.5 million transactions against 93.1 million on Bitcoin’s blockchain. Based on data from Nasdaq and Yahoo charts, the average daily transactions were around 1.1 million for ETH and 255,000 for BTC.
Ethereum and Bitcoin transaction count in 2022
The transaction volume on Bitcoin was steadier and more periodic than Ethereum. Data reveals higher volatility in transaction volumes on Ethereum’s blockchain was due to spikes in demand at NFT launches and minting of blue-chip digital collectibles.
Interestingly, Ethereum’s higher transaction volume can be attributed to a higher number of investment opportunities in the altcoin’s ecosystem.
Fred Wilson, a Venture Capitalist in New York argues that web3 firms are likely to react to the 2023 recession similar to traditional finance firms. Typically, traditional finance firms raise funds to tackle the negative impact of recession and sustain their business. Large capitalization cryptocurrencies like Bitcoin and Ethereum could attract more interest from investors, however, of the two, the outlook on ETH is more bullish.
Wilson argues that ETH has the best underlying economic model of any web3 asset. Web3 sector is expected to go through a triage and projects with no product market fit, weak or no token economics could fail in 2023.
While there is a large overhang in web3, the VC expects a spike in selling pressure on web3 tokens for at least the first quarter of 2023. The Ethereum ecosystem has several digital collectibles, art, and real-world utility projects in web3 that continue to garner attention from investors. This tilts the scales in favor of ETH as the altcoin offers massive investment opportunities in web3 to investors, through crypto winter, the spreading FTX contagion and the anticipated recession in 2023.
