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Ethereum market cap hits $337 billion, surpassing Nestle, P&G and Roche

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Ether (ETH) price has rallied more than 200% in 2021, resulting in a massive $337 billion market capitalization. This impressive figure pushed the value of the Ethereum network ahead of the total market cap of major companies like Procter & Gamble’s ($326 billion) and PayPal’s $308 billion.

The market cap figure is achieved by multiplying the last trade price by the total outstanding number of coins, regardless of whether they’ve been moved. Therefore, it seldomly reflects the average price where most investors transacted.

For investors from traditional finance, ‘value’ is assessed by comparing multiples and valuations. These are often calculated in the form of earnings, sales, and market share, and attempting to apply these same ‘value’ metrics to cryptocurrencies with multiple use cases creates uncertainty and discomfort.

Ether is a multi-faceted asset that is difficult to evaluate

There is not a bullet-proof metric available to assess how Ether’s value stacks against its potential. The cryptocurrency might simultaneously act as a digital store of value while also functioning as the token required to access the Ethereum network.

Ether market cap, in USD billion. Source: TradingView

Therefore, one must consider the coins deposited on exchanges or the percentage effectively changing hands when comparing different asset classes. The existence of regulated derivatives markets allow institutional investors to bet against the asset’s price, and it is another factor that should be accounted for.

Largest global assets’ ranking by market capitalization. Source: Infinite Market Cap

While the merits of comparing the market cap of different asset classes side-by-side is debatable, the metric essentially works the same way for commodities, stocks, and mutual funds.

According to data from Infinite Market Cap, Ether recently surpassed the market cap of Nestle, Procter & Gamble, PayPal, and Roche.

The American multinational consumer goods company P&G was founded in 1837 and holds a diversified brand portfolio, including personal health, consumer care, and hygiene. With 100,000 employees worldwide, the conglomerate posted a $13 billion net income in 2020.

On the other hand, Ethereum has 2,320 average monthly developers, according to the Electric Capital’ Developer Report’. Although it is not a secular company, its decentralized applications (dApps) handle over 100,000 daily active addresses. Even more impressive is the $12 billion daily transfer and transactions on the Ethereum network. These numbers alone are outstanding even for an S&P 500 company.

Stocks have their own risks, which can’t be ignored

Comparing a 183-year company that is heavily dependent on production and distribution to a technology-based protocol is unlikely to uncover many similarities. However, equity investors enjoy the fruits of dividends, and while some will argue that Ether could be staked for a return, there are more significant risks involved.

Investors staking in the ETH 2.0 contract have the options of becoming a full validator or joining a pool but their coins could be lost due to malicious activity or by failing to validate network transactions. Similar risks emerge when lending Ether via centralized services and decentralized protocols.

On the other hand, listed companies can create new shares to benefit from excessive valuations or increase their cash position.

Tax changes, operational liabilities, and regulatory changes are other risks that stockholders sometimes face. For example, Roche was recently challenged for $4.5 billion from the government for deceiving the CDC, according to a lawsuit unsealed in September 2019.

Decentralized protocols are virtually free of these perils, and perhaps this justifies their sky-high valuations.

Considering the risks described above, investors might conclude that holding Ether is less risky than buying stocks. At least it is possible to self-custody, making the asset less dependent on third parties and unauthorized transactions.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.





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Ethereum

Analysts suggest Dogecoin traders are rotating profits into large-cap altcoins

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Every cryptocurrency bull market has at least one surprise catalyst that comes out of nowhere to excite traders and spark massive trading volumes that lift the total market capitalization to new highs. 

The 2021 bull market is no exception to this rule, and one of the biggest catalysts for growth this year has been the explosive popularity of Dogecoin (DOGE), which has made headlines in traditional and alternative financial circles as its price surge to new all-time highs over the past few months.

DOGE/USDT 4-hour chart. Source: TradingView

With such tremendous growth happening in just a few short months, it’s only natural for traders to make moves that help lock in gains and then search for the next potential mover to invest in.

The price action for DOGE even caught the eye of Jon Bollinger, inventor of Bollinger Bands, who on May 3 tweeted “$Dogeusd put in a top, fell by 65%, and is now knocking on the door again while $dogebtc is breaking out. Simply amazing price action.”

Dogecoin was trading near $0.40 at the time of the tweet but has since skyrocketed 80% to a new all-time high at $0.69. After today’s strong rally, Bollinger to posted the following tweet as a word of advice to DOGE traders:

And it appears that some traders had similar thoughts or took Bollinger’s words to heart on May 5, as the price of DOGE experienced a pullback of 25% before recovering near the $0.60 level.

Large-cap altcoins benefit from Dogecoin’s momentum

Several observant traders, including Digital Currency Group founder Barry Silbert, pointed out that a lot of DOGE’s trading activity has happened on the Robinhood trading app and that the other cryptocurrencies available on the platform could benefit from traders rolling profits over from DOGE into slower performing cryptocurrencies.

This turned out to be a prescient viewpoint, as all the major cryptocurrencies available on Robinhood have seen double-digit gains on May 5, while the price of DOGE has experienced a 25% pullback.

Ethereum Classic (ETC) has been one of the biggest beneficiaries of the shift in funds, which helped the Ethereum fork blast to a new record high of $100 on May 5. In the same period, Bitcoin Cash (BCH) and Bitcoin SV (BSV) have seen gains in the 25%–30% range.

While the percentage growth seen in the price of Litecoin (LTC) is less than that of the other tokens listed on Robinhood, LTC’s 15% rally pushed the altcoin to a new multiyear high of $351. This puts LTC price less than 7% below its previous all-time high at $375.

LTC/USDT 4-hour chart. Source: TradingView

According to data from Cointelegraph Markets Pro, market conditions for LTC have been favorable for some time. 

The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. LTC price. Source: Cointelegraph Markets Pro

As seen on the chart above, the VORTECS™ Score for LTC began to pick up on April 29 and maintained an elevated level over the next four days before hitting a high of 68 on May 2, around 11 hours before the price increased 35% over the next three days.

With DOGE still trading above $0.58 at the time of writing and hype is continuing to build ahead of Elon Musk’s appearance on the comedy sketch show Saturday Night Live, the bullish price action for LTC and the other cryptocurrencies available on Robinhood could continue as retail traders new to the crypto market flock to the popular meme coin.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, and you should conduct your own research when making a decision.