The Ethereum (CRYPTO: ETH) price is rebounding, up 1.7% over the past 24 hours. One Ether is trading for US$2,844 (AU$3,949).
Bitcoin (CRYPTO: BTC), still by far the world's biggest crypto by market valuation, is back in the green as well. Bitcoin is up 1.3% since this time yesterday, trading for US$41,491.
That gives Bitcoin a market cap of US$781 billion.
At the current Ethereum price, its market cap stands at US$334 billion.
While that's still less than half of Bitcoin's total market value, crypto analysts are speculating that Ether may well overtake Bitcoin in the not too distant future.
The case for smart contracts
The Ethereum price has been a much stronger performer than Bitcoin over the past year.
Much of that, crypto analysts surmise, is due to the fact that the Ethereum network has valuable real life applications for business and finance. Many of which remain untapped.
Bitcoin, on the other hand, is limited to payment transactions. And, of course, you can hold onto it as well in hopes of making a profit.
Financial TikTok influencer Mason Versluis, aka "Crypto Mason", doesn't see much of a future for Bitcoin. But Versluis, who has some half a million followers on his account, is far more optimistic on other tokens with real life uses, like Ether.
According to Versluis (quoted by Business Insider):
It's got to have use cases, meaning: does this token do nothing? Am I just buying this token because I think it's going to go up in value? That is what I am personally invested in, just because of the potential – they actually do something. Ethereum has so many decentralised applications built on it.
The decentralised applications he's talking about here make use of smart contracts so they can be self-executing.
So what's a smart contract?
According to CoinDesk:
Smart contracts are code-based programs that are stored on the Ethereum blockchain and automatically carry out certain functions when predetermined conditions are met. This can be anything from sending a transaction when a certain event takes place, or loaning funds once collateral is deposited into a designated wallet.
With the digitisation of data racing ahead, the use cases described above could well be one reason investors have been driving the Ethereum price sharply higher.
Ethereum price snapshot
As an important reminder of the volatility involved with cryptos, the Ethereum price is still down 35% from its all-time high of US$4,379, reached on 12 May.
However, it has been a strong performer over the past full year, well outpacing Bitcoin.
The Ethereum price has gained 707% over the past 12 months, compared to a 288% gain for Bitcoin.
Year-to-date Ether has gained 291%, compared to a 43% gain for Bitcoin so far in 2021.
