According to analysts at Goldman Sachs, the popularity of Ethereum could make ETH the leader in terms of capitalization. DeFi projects and other applications will contribute to this.
In the letter to customers, Goldman Sachs representatives emphasize that Ethereum has the highest “potential for real-world use”. Therefore, ETH may well become the largest cryptocurrency and the most popular digital asset for storing wealth.
“Ethereum looks like a cryptocurrency with the greatest potential for real-world use, especially since it is the most popular platform for developing applications based on smart contracts,” the letter says.
Goldman Sachs analysts admit that bitcoin has a stronger brand, but the first cryptocurrency does not provide the opportunities that Ethereum provides. In addition, it takes much longer to confirm transactions on the Bitcoin network.
Ethereum is growing at a faster pace, including in terms of capitalization. For example, if the BTC rate increased by 261% over the past year, then ETH added 856% in price at once. However, while gold is still the leader as a defensive asset:
“Rivalry among cryptocurrencies is another risk factor that prevents these assets from gaining a stronger position as inflation hedging assets.”
Interestingly, just a couple of weeks ago, Goldman Sach analysts said that cryptocurrencies are good for speculation, but too risky for long-term investments.