Survey: Ethereum to Outshine Bitcoin in 2023

A new survey has revealed that Ethereum will outshine Bitcoin in 2023. According to the latest Ethereum news, the CoinShares survey involved 43 investors with about $390B of assets under management.

Per the survey, digital assets represented just 1.1% of investment portfolios. These investors noted they continue to stake their funds in digital assets because of their speculative nature and the potential of blockchain technology. The investors noted that increased regulation of the cryptocurrency industry or the outright ban of assets were significant risks to the digital asset class. 

Likewise, the survey revealed an increase in concern about asset custody. This is not surprising given that the collapse of FTX increased the SEC’s scrutiny of the operations of firms offering crypto asset custodial services directly or indirectly. That wasn’t all. While reports suggest that Bitcoin and Ethereum will remain the dominant crypto assets, the survey revealed that investors favoured Ethereum as having the biggest potential in 2023.

Ethereum Has Better Outlook

According to the survey, 60% of investors the respondents believe that Ethereum has a better market outlook. Another 30% believe that Bitcoin has a compelling growth outlook. Comparatively, both tokens tied at 40% of the survey respondents in the last survey in October 2022.

What’s surprising is that the survey reports come after both tokens have enjoyed a dramatic rise in their prices. Since the turn of the year, both tokens have enjoyed a minor bull run that brought the  YTD values to 31 and 39% for Ethereum and Bitcoin, respectively. Both tokens also surpassed their prices in November 2022, after which the FTX crash sent prices tumbling and made the coins more volatile.

Despite the difference in YTD, the investors believe Ethereum has better potential. There are suggestions investor sentiment may be due to the weekly inflow of investment products that suggest that a bearish run is imminent for Bitcoin.

At the time of writing, Bitcoin was trading at $23,187 with a 24-hour trading volume of $27.2 billion and a market cap of $446.9 billion. Contrarily,  Ethereum was trading at $1,586 with a  24-hour trading volume of $9.4 billion and a market capitalization of $194 billion.

Factors that Will Propel Bitcoin and Ethereum

Senior vice president at Moody’s Investors Service, Vincent Gusdorf, believes that more investors will embrace established assets like Bitcoin and Ethereum in 2023. According to Gusdorf, stricter financial conditions and frauds will prevent other crypto assets from picking up. Contrarily, several factors may cause an uptrend for Bitcoin and Ethereum. The US Fed Rate and The US Nonfarm Payroll top the list. 

With the FOMC, BOE and ECB all expected to announce new interest rates by February 1, trading volume has declined by 7.81%. Many retail investors are unsure whether to expect a dovish or hawkish stance. Many investors predict the FOMC will hike rates by another 25 basis points this week and possibly add another 0.25% by March.

The US Nonfarm payroll figures can also impact the prices of Bitcoin and Ethereum significantly. Many traders use the US NFO figures to determine when to buy or sell digital assets, with the market tending to be particularly volatile when US NFP figures are released.

After adding only 223k jobs in December 2022, it is clear that hiring is slowing down. Many technology firms also announced key layoffs. The US Feds project a tighter job market and expect unemployment to climb to 4.6%.

Aave Deploys on Ethereum

Meanwhile, Aave has deployed the third version of its lending app on the Ethereum chain. Previously, Ethereum users could only access version V2. With Aave V2, Ethereum users can expect to save on gas fees and maximize their capital. Additionally, riskier assets can be used as collateral to borrow stablecoins with the isolation feature. In the future, V3 will also be deployed on Avalanche, Arbitrum, Optimism and Polygon chains. 

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