Bitcoin stagnates as other cryptocurrencies soar

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The interest of investors – especially the small ones – in buying cryptocurrencies is constantly growing and after a record increase in the exchange rate of the most widespread cryptocurrency bitcoin (BTC), the record rally has now moved to other cryptocurrencies. Currently, the virtual currency Ethereum (ETH) is attracting the greatest investor attention and on Monday, 3 May 2021 its exchange rate against the US dollar (USD) exceeded US$ 3,000 per ETH. The cryptocurrency BTC is currently rather stagnant with the price below US$ 60,000 per BTC.

On 4 May at 7:40 am CET, the BTC exchange rate fluctuated against the USD on the Coinbase digital currency market, trading at US$ 55,980.15 per BTC with the current daily decline of BTC by -2.67% of the against the USD. However, other cryptocurrencies, unlike BTC, show an increase in their exchange value and in particular the ETH, whose exchange rate at this time was US$ 3,354.83 per ETH with the current daily growth of ETH by +1.75% against the USD. According to economic correspondents, data from the Bitstamp trading platform show that since the beginning of the year the ETH cryptocurrency has seen a more than 300 percent increase in its exchange rate against the USD, while BTC has grown less than 100 percent. The dominance of bitcoin on the cryptocurrency market has thus dropped significantly this year and the share of ETH has already reached about 15 percent of the total cryptocurrency trade.

However, the bitcoin position on the cryptocurrency market is still strong and investor interest remains considerable, despite its current decline. Bitcoin is an internet open-source P2P payment network and also the cryptocurrency used in this network. Bitcoin’s main uniqueness is its full decentralization; it is designed so that no one, including the author or other individuals, groups or governments, can influence the currency, falsify, confiscate accounts, control cash flows or cause inflation. There is no central point in the network, and no one can make decisions. The final amount of bitcoins is known in advance and the release of bitcoins into circulation is defined in the network source code. There are minimal or no cost payments. The network has been operating since 2009 and it was created by a group of people known as Satoshi Nakamoto.

What helped BTC in recent months was the interest of several major companies. For example, at the beginning of 2021 this year, the world-famous company Tesla invested more than US$ 1.5 billion. A similar step was taken by the software company Microstrategy, and the payment service PayPal also contributed to the BTC price increase, allowing its clients to buy cryptocurrencies and pay for goods in bitcoin from more than tens of millions of sellers. According to analysts Ethereum differs from bitcoin in many ways and financial strategists say that many investors see ETH as a smart cryptocurrency, having many more functions than bitcoin. BTC is primarily intended to serve as currency or an investment instrument of a speculative nature.

According to cryptocurrency analysts bitcoin is the only medium of exchange that can offset central banks printing money. “Bit gold” and “b-Money” concepts were the basis for the creation of bitcoin. There is now an official software client for payments, managed by volunteers from around the world and several alternative clients. Since 2011 conferences have been held all around the world on bitcoin, economy, possibilities and implications of this currency. In September 2012, the non-profit company Bitcoin Foundation was established to take care of the bitcoin infrastructure, monitor threats and possibly improve protocols, organize conferences and promote the currency. However given the decentralized nature of the network, the foundation has no special powers as the majority always makes decisions. In 2014, the Apache Software Foundation, a non-profit organization, began accepting donations in bitcoins.

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