Why is ETH so much cheaper than BTC (Why does ETH rise so high)?

Why is ETH so much cheaper than BTC? The transaction fees on the Ethereum network are currently more than twice that of Bitcoin, while other currencies (such as BNB, ADA, and TRX) are far behind. Although ETH has risen by over 2000% in the past year, this is mainly due to the network performance of Ethereum, especially in the DeFi sector: the value of locked assets on Ethereum is close to $3 billion, and according to DeFiPulse data, the total locked value is now around $12 billion. (CryptoPotato)

From a historical perspective, there is a clear correlation between the price of Bitcoin and the price of Ethereum. However, after the volatility in the cryptocurrency market in 2018, Bitcoin started to decline – its average volatility has dropped below 30% since 2017. (Cointelegraph)

Why does ETH rise so high

Editor’s Note: This article is from the Storm community (ID: FHBT18), written by Peipei, authorized reprint of Odaily Star Daily.

The recent market trend is somewhat similar to the rapid rise of Ethereum last year.

Last night, ETH rose to around $400, which is also very impressive during this period.

I have previously written an article about why ETH rises so high:

Hello everyone, I am Peipei. This morning, I will share this news with you. Let’s first take a look at what this news is all about. What is it?

First of all, we need to understand what it is. It is the price fluctuations of mainstream cryptocurrencies such as Bitcoin and Litecoin. The reasons for the violent fluctuations are threefold: 1. Due to its nature and the economic model behind it, its price is easily affected by the market; 2. It is not entirely suitable for use as a means of payment because it does not have legal tender and anonymity issues.

If it is valuable to other digital assets, it is actually a “virtual commodity” (such as stocks), or more broadly, it is similar to security tokens (such as gold or oil), but in this case, it has no practical application scenarios. (The truth here does not refer to blockchain technology itself). Of course, there are also some reasons. One is that it is not mature enough at present. The second is that this project still has a lot of room for development. The third is its ecological development. The fourth point is that compared with other imitations, they do have some differences, but there are also certain potential areas to explore.

Let’s analyze from the two aspects above:

1. Is ETH much larger than BTC? This is because ETH is already considered by many to be the most popular cryptocurrency outside of Bitcoin, and there are also many new users coming in to buy ETH as collateral. They will choose whether to hold it based on their investment needs. So this question is actually something many newcomers don’t know how to understand. But I think this can also help a lot of foreigners.

There are also some dapps on eosdefi, such as some DeFi platforms on the market, which have similar situations.

2. Will there be any changes after the launch of ETH 2.0? This should be a question that everyone knows, after all, the development work of ETH has not officially started yet, but if you want more people to use it, it is best to have a suitable time for testing (such as June 30th this year, which is when we just launched a testnet) and then upgrade.

3. What will happen after the launch of ETH 2.0? This needs further understanding. Below, I will briefly introduce a few main changes:

1. The current mining profitability in the system is negative, so you may feel that fewer people are participating, but at the same time, you will also find that there is a large amount of computing power generated by ETH.

When you start paying attention to ETH, you will get this information – the balance in your wallet address is transferred through mining ETH, and you will receive a share of the transaction fees every day. If you put ETH in the exchange, you will receive a certain reward (such as gas fees shared with users willing to pay for gas costs); as long as you have an account,