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Institutional Investors Prefer ADA and ETH Over BTC

By:
Hassan Maishera
Published: Nov 18, 2021, 15:29 UTC

Bitcoin remains the leading cryptocurrency, but its market dominance has been decreasing over the past few months.

Bitcoin and Ethereum

A recent report by CoinShares revealed that institutional investors are flocking into Cardano and Ethereum over Bitcoin.

ETH and ADA Gain Preference

Ethereum and Cardano are amongst the top ten cryptocurrencies by market cap. However, Bitcoin remains the industry leader in terms of market cap and adoption. Despite that, Bitcoin’s dominance in the market has been decreasing in recent years, and investors are now looking at other cryptocurrencies.

According to CoinShares, institutional investors bought $17.3 million worth of Ethereum-related investment vehicles last week. This was closely followed by ADA, with a total of $16.4 million. The institutional investment in ADA and ETH surpassed that of BTC as investors began to look at altcoins.

While Bitcoin remains the leading cryptocurrency in the world, it is not the most widely used blockchain. The Ethereum blockchain remains the most widely used in the cryptocurrency space. It is home to most decentralized finance projects, nonfungible tokens and decentralized applications. With the cryptocurrency space gaining increasing adoption, more people use the Ethereum blockchain due to its massive applications.

ADA/USD chart. Source: FXEMPIRE

Cardano is another programmable blockchain that has been gaining massive adoption in recent months. The recent upgrades have seen the Cardano blockchain host numerous DeFi projects. Furthermore, more dApps are launching on the Cardano network.

Institutional investors are looking at the use cases of blockchains, and Ethereum and Cardano surpass Bitcoin at this moment. Bitcoin is being viewed as a store of wealth by most market participants at the moment while Ethereum and Cardano continue to build utilities around their blockchains.

Institutional Investments in ADA and ETH Could Continue to Eclipse BTC

The trend could continue for a while as the Ethereum and Cardano developers continue to improve the networks to ensure they are homes to Web 3.0. At the moment, there is a huge gap in terms of their trading volumes and market cap.

Ether is trading above $4,100, up by over 450% since the start of the year and has a market cap of nearly $500 billion. Cardano, on the other hand, is $1.80 per coin, up by nearly 900% YTD, and its market cap is around $60 billion.

Bitcoin remains the dominant player, with a market cap above $1.1 trillion and is trading above the $60k level. Despite that, Bitcoin’s market dominance has been dropping in recent months and currently stands at 43.6%.

About the Author

Hassan is a Nigerian-based financial Journalist and cryptocurrency investor.

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