The Bitcoin BTC cryptocurrency, despite a sluggish recent period, has made significant gains year-to-date in terms of price.

Against the backdrop of shifting crypto market dynamics, Cathie Wood's Ark Invest has released a new report examining the validity of the apex currency.

Recent rhetoric in the cryptocurrency space suggests that Bitcoin is dead and Ethereum ETH is out of date, and that newer smart contract blockchains that enable faster and cheaper transactions are the future, according to Ark Invest analyst Frank Downing. "Bitcoin is a self-sovereign digital currency," Downing said.

He added that recent token appreciation associated with blockchains such as Solana SOL -9.49 percent + Free Alerts and Avalanche AVAX, as well as endorsements from top crypto funds such as a16z, Multicoin Capital, and Three Arrows Capital, substantiated his point of view.Are you interested in making money from cryptocurrency trading? Investors in cryptocurrency, such as you, are receiving profitable trade recommendations from Benzinga's crypto research team! To view the next trade, please click here.

Those who hold this viewpoint are misinformed because they fail to recognize that each blockchain optimizes and maintains the integrity of its stored data in a unique way, making tradeoffs in order to achieve the functionality and security appropriate for a specific use case, according to the analyst.According to Downing, bitcoin provides the most profound function of blockchain technology, serving as the foundation for "self-sovereign" digital money.

Only Bitcoin has optimized for being able to compete in the "money revolution," which necessitates the assurance of data integrity and the avoidance of censorship in the face of nation-state level attacks, according to him, due to its fair launch and decision to forego functionality such as smart contracts.

A fair launch is the equitable and transparent distribution of coins at the start of a blockchain project's lifecycle.

In Downing's opinion, Bitcoin's reluctance to evolve its design, despite being frequently criticized, is a feature that provides the stability and consistency necessary for it to serve as a true global money.

Evolving networks are at risk of centralization: Smart contract blockchains, such as Ethereum, on the other hand, are competing in a "technology revolution," according to the analyst. He believes that the rise of decentralized finance and non-governmental organizations (NGO) is the best illustration of this.

According to Downing, the technological revolution necessitates diversified functionality and higher throughput in order to accommodate more use cases, which frequently comes at the expense of the level of decentralization and stability provided by Bitcoin.

The risk of centralization and, in our opinion, a reversion to the institutional status quo arises as the market determines the appropriate level of decentralization required for each use case in an evolving network.

According to the analyst, crypto opportunities are developing in parallel, with each requiring a different network implementation and set of design tradeoffs. He went on to say that diversity will spur competition, which will be beneficial to the crypto space as a whole.