Yes it's bubbling, but the question is how big of a space does it have to grow into? The way things are going right now it seems like ETH is winning the PR campaign. If this is the case, then more institutional money is going to flow into ETH + other blockchain projects in the months/years that follow. This money will dwarf anything we have seen so far. The current ~115 billion marketcap for such a globally accessible asset class is a joke. The global bond market is 82 trillion and so a 5 year target market cap for crypto of 1 trillion seems reasonable. Price will always see-saw, but general trend will be upwards.
BTC and ETH can coexist in this vast space. However, in short term, BTC's scaling issues are going to scare away new money that doesn't fully comprehend the space. If BTC can solve these issues as quickly and as quietly as possible then it won't yield that much ground. But the longer this drags on that's an opportunity for ETH to gain more popularity and keep marketing itself as "Bitcoin perfected". If 2 BTCs emerge on Aug 1 as some people theorize then things could get bad. This doesn't even need to happen, the theory itself is bad enough to yield more ground to ETH. Yes ETC and ETH happened but new money wasn't paying attention. I am not anti BTC by the way, I have a lot of love for it. I am just applying the logic that institutional investors would use when viewing the current landscape for the first time.
My main area of concern for crypto is what the US regulators are going to do. They can't leave this space unregulated because the money is starting to be systematically important and the ICO activity looks like it's breaking many of the old securities rules. I just hope they don't come in with a heavy hand that will chill activity. The good news here is that other countries are making noises about being competitive in crypto and so that should hopefully push them in the right direction.