The recent war of words and increased tension between the United States and North Korea has seen many investors flocking towards cryptocurrencies—most notably, Ethereum. The potential threat of escalation and the looming possibility of a major war between two of the world’s largest militaries has led many investors to steer away of traditional ‘safe’ investments like gold and treasuries. Instead, more and more investors have been pumping money into Bitcoin, Ethereum, OneCoin and other major cryptocurrencies.
Cryptocurrency as a Safe Investment
Even of the threat of a major war can cause world markets to experience a serious downturn, and there is the risk that the market could completely plummet should tensions escalate and lead to an actual conflict. The fact that cryptocurrencies are independent from any government or central authority is primarily the reason why many investors are starting to see digital currency as a safer investment. This had led many investors to start diversifying into cryptocurrencies in order to hopefully mitigate against the risk of a potential market downturn. Although there is still a good chance that the cryptocurrency market could also experience a downturn should the world economy begin to decline, the independence and lack of government interference should ensure that cryptocurrencies remain more resilient and less susceptible to typical market forces.
The Growing Influence of Ethereum
Although Bitcoin and other major cryptocurrencies have all experienced rapid growth recently, the biggest winner still seems to be Ethereum. The currency’s trading volume grew to over $2.6 billion this past Wednesday, which represents a 60% higher trading volume than Bitcoin and is only the second time ever that Ethereum has been more highly traded than Bitcoin. In addition, the value of ethers rose to over $300 for the first time in four months. The vast majority of these increases were driven by Koreans, and statistics show that more than 40% of the currency’s total trading volume is in South Korean won.
Although there are many possible explanations for why Ethereum is suddenly trading higher than Bitcoin, many cryptocurrency experts believe that the reason lies in Ethereum’s block chain technology. The recent Bitcoin blockchain split seems to have gone much more smoothly than most would have expected and should help to alleviate some of Bitcoin’s inherent issues. However, there is still no doubt that Ethereum’s blockchain is much more resilient. Over time, this should allow ethers to finally overtake bitcoins—even if it may still be many months or even years before this finally happens.
Bitcoin’s Days May Be Done
Another problem that Bitcoin faces is that it continues to be closely linked to organized crime, money laundering and corruption. In addition, Bitcoin has already proved to be extremely volatile, and some experts claim it is more than 10 times as volatile as investing in gold. Although Ethereum, OneCoin and other cryptocurrencies haven’t ever experienced the same huge price spikes as Bitcoin has, these other digital currencies also haven’t had their prices suddenly plummet in the same way as Bitcoin. There is also the issue that Bitcoin’s founder is still unknown, which casts yet another cloud over the currency.
OneCoin on the Rise
While Ethereum is experiencing huge gains in Korea, the lesser known OneCoin has been making huge gains in various countries across the globe. Although it is not yet anywhere near the level of Ethereum or Bitcoin, there are many experts who predict that OneCoin has the potential to be one of the strongest cryptocurrencies in the future. Not only is the currency considered far more secure and less prone to hacking than Bitcoin and even Ethereum, but it also uses a unique technology that allows it to avoid many of the criminal and money laundering issues plaguing Bitcoin.
The fact that more and more people continue to invest in cryptocurrencies means that Bitcoin, Ethereum and the others are not likely to go away any time soon. If anything, these currencies are only going to continue to grow in the future. Of course, it still remains to be seen whether or not cryptocurrencies will actually be immune to major market downturns are many experts and investors are predicting.