On Wednesday, a interview with BlackRock CEO Larry Fink went viral in which the CEO called Bitcoin an international asset. Not only that, Fink also pointed out that digital assets like Bitcoin are a way to digitize gold on the blockchain. This CEO statement has since been variously interpreted to mean that Fink referred to BTC as digital gold. So the question now remains, if Bitcoin is digital gold, which cryptocurrency is digital silver?
ETH is digital silver?
The digital gold argument for Bitcoin continues, but as Ethereum is the second largest and most popular cryptocurrency on the market, it has often been referred to as “Digital Silver”. Over the past seven years, its performance has also solidified claims that Ethereum is silver to Bitcoin’s gold.
There have been claims in the past that Litecoin qualifies to be called digital silver. Most of these claims were based on the fact that Litecoin’s mechanism is basically identical to BTC’s. However, when it comes to performance, it has fallen short compared to ETH, which is now BTC’s biggest rival.
However, one area where Litecoin tends to outshine Ethereum is when it comes to supply. While Litecoin undergoes halving events every four years like BTC to reduce its block rewards and has a maximum supply, Ethereum has neither of these things. The unlimited supply of ETH has generally been a concern, as this means the digital asset could be a perpetually inflationary asset. That is, until the implementation of the ETH burn, intended to reduce the rate at which new coins are put into circulation.
Data from Ultrasound Money, a website that tracks the rate of ETH burning and issuance, shows that instead of increasing, the supply of ETH is now declining at a rate of 0.33% per year. This development removes concerns about ETH inflation, giving more credence to the fact that Ethereum is digital silver.
ETH price above $1,900 | Source: ETHUSD on Tradingview.com
Bitcoin vs Ethereum, which is better?
The argument about the better option between Bitcoin and Ethereum continues to grow, especially on social media platforms. However, these two digital assets are unique in their own way and serve different roles in the marketplace.
While Bitcoin continues to hold the torch as the pioneering cryptocurrency, garnering massive support over the past decade, Ethereum, in its own right, has pushed the concept of decentralized finance (DeFi) forward.
The use of smart contracts in the latter has helped developers create financial products that investors can leverage to manage their own wealth without the need for a middleman. Although this capability is gradually being developed in Bitcoin as well.
For now, both digital assets serve different sides of the market. However, this could easily change in the future.
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