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Ethereum Is the Microsoft of Blockchains, ETH Underperformance May Reverse Into Year-End: Bitwise
The Ethereum blockchain has the most active developers, the highest number of active users and ether has a market cap that is five times larger than its nearest competitor, the report said.
Updated Sep 18, 2024, 9:02 a.m. Published Sep 18, 2024, 8:59 a.m.
- Despite recent underperformance, ether is potentially a contrarian bet into the year-end, the report said.
- Bitwise noted that the majority of stablecoins are issued on the Ethereum blockchain and more than 60% of all DeFi assets are locked on the network.
- Ethereum is like the Microsoft of blockchains, the asset manager said.
Ether , the second-largest cryptocurrency, seems to be liked by nobody right now, but the native token of the Ethereum blockchain's underperformance could reverse as the year draws to a close, Bitwise said in a report on Tuesday.
The asset manager noted that year-to-date ether is little changed, while bitcoin is up 38% and Solana's sol has risen 31%.
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Ether's recent underperformance stems from risk related to November's U.S. presidential election, rising competition from Solana and other blockchains, challenged tokenomics and a mixed response to the introduction of spot exchange-traded funds (ETFs) in the U.S., the report said.
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Still, it's not all doom and gloom. The majority of stablecoins are issued on Ethereum, more than 60% of all decentralized finance (DeFi) assets are locked on the blockchain and the popular prediction market Polymarket also settles on the layer-1 chain, Bitwise noted.
"Ethereum has the most active developers, the most active users, and a market cap that is 5X bigger than its closest competitor," wrote Matt Hougan, chief investment officer at Bitwise.
"It's like the Microsoft (MSFT) of blockchains," Hougan wrote. Everyone wants to talk about about newer companies and their game-changing tech such as Google (GOOG), Slack (WORK) and Zoom (ZM), "but Microsoft is still larger than all of them put together."
Ether's challenges are not "existential" and the market may reevaluate the cryptocurrency closer to the U.S. election. "It looks like a potential contrarian bet through the end of the year," the report said.
Read more: Will Ether's Supply Crunch Lead to Higher Prices in Q4?
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Exchange Review - March 2025
CoinDesk Data's monthly Exchange Review captures the key developments within the cryptocurrency exchange market. The report includes analyses that relate to exchange volumes, crypto derivatives trading, market segmentation by fees, fiat trading, and more.
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Trading activity softened in March as market uncertainty grew amid escalating tariff tensions between the U.S. and global trading partners. Centralized exchanges recorded their lowest combined trading volume since October, declining 6.24% to $6.79tn. This marked the third consecutive monthly decline across both market segments, with spot trading volume falling 14.1% to $1.98tn and derivatives trading slipping 2.56% to $4.81tn.
- Trading Volumes Decline for Third Consecutive Month: Combined spot and derivatives trading volume on centralized exchanges fell by 6.24% to $6.79tn in March 2025, reaching the lowest level since October. Both spot and derivatives markets recorded their third consecutive monthly decline, falling 14.1% and 2.56% to $1.98tn and $4.81tn respectively.
- Institutional Crypto Trading Volume on CME Falls 23.5%: In March, total derivatives trading volume on the CME exchange fell by 23.5% to $175bn, the lowest monthly volume since October 2024. CME's market share among derivatives exchanges dropped from 4.63% to 3.64%, suggesting declining institutional interest amid current macroeconomic conditions.
- Bybit Spot Market Share Slides in March: Spot trading volume on Bybit fell by 52.1% to $81.1bn in March, coinciding with decreased trading activity following the hack of the exchange's cold wallets in February. Bybit's spot market share dropped from 7.35% to 4.10%, its lowest since July 2023.
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What to know:
- Ethena's USDe becomes fifth stablecoin to surpass $10 billion market cap in just 609 days, while Tether's dominance continues to slip.
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