Bloomberg report: Tether will overtake Ethereum market capitalization by the end of 2021
According to Bloomberg’s Crypto Outlook report for Q4 2020, Tether will most likely displace Ethereum for the second largest market capitalization in 2021, leading to greater adoption for stablecoins and central bank-backed digital currencies (CBDCs).
Tether will overtake Ethereum market capitalization by the end of 2021
Senior Commodity strategist and author of the report Mike McGlone cites a “stagnant market cap” ahead for Ethereum, despite currently being valued at more than $43 billion.
The report notes that:
“Ethereum remained under $30 billion for most of 2019 and 2020 before undergoing an explosion over the summer driven by investor interest in decentralized finance products.”
Compared to ethereum, McGlone predicts USDT will continue its steady growth pattern that began in 2017. The stablecoin has already increased by more than 280 percent in 2020, rising from $4.1 billion at the beginning of the year to $15.7 billion as of October.
The report stated:
“It should take something significant to stall the increasing adoption of Tether. If current trends prevail, the market cap of Tether may surpass Ethereum next year.”
ETH price holding gains
There was another attempt by Ethereum to surpass the $385 and $388 resistance levels, but it failed to gain momentum. ETH price traded as high as $388 and recently declined below the $380 support.
There was also a break below a short-term rising channel with support near $378 on the hourly chart of ETH/USD. Ether price spiked below the $375 level and the 100 hourly simple moving average. It traded as low as $373 and it is currently recovering higher. There was a test of the 50% Fib retracement level of the recent decline from the $388 high to $373 low. It seems like the price is facing hurdles near the $380.
The next key resistance is near the $382 level since it is close to the 61.8% Fib retracement level of the recent decline from the $388 high to $373 low. A successful break above the $382 level might increase the chances of a break above the $388 resistance in the near term.
In the stated case, ether buyers are likely to aim a break above the $395 monthly high. An immediate hurdle above the $395 resistance is near $400. Ethereum is holding a couple of important supports near the $373 and $372 levels. If there is a downside break below the $373 low, the price might even decline below $370.
The main breakdown support is near the $365 level, below which the price is likely to continue lower towards the $355 and $350 levels in the coming sessions.
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