A phrase has developed in the cryptocurrency community to describe a hypothetical scenario where Ethereum overtakes Bitcoin in terms of market capitalisation. Many cryptocurrency experts predict that this moment will be known as “the flippening”, and it’s an inevitable result. With $942 billion invested, Bitcoin currently ranks number 1 in the world for market capitalisation.
With $442billion in invested capital, Ethereum ranks second. Cardano, which has $98 billion invested recently, is third.
Will Hamilton, Head for Trading and Research at TCM Capital said that “the flippening” is a reference to the fact that Ethereum could overtake Bitcoin’s market capital.
TCM Capital’s crypto expert said that Ethereum’s “monetary policies are now borderline deflationary with a negative inflation rate of more than 1.4 percent”.
He said: “Post ETH2.0, we will have a very low-interest asset with real world applications, since Ethereum is the foundation of most of the crypto ecosystem.”
The value proposition of Ethereum is twofold. One, it will be a rare store of value and two, it will be a real-world, commercial application that drives revenue and profits for those companies who sit at the top.
Comparing that to Bitcoin is a good way to see which one has greater value.
Although Ethereum’s position is under threat from “Ethereum Killers”, like rivals Cardano or Solana, one expert in crypto believes that Ethereum will remain the second-largest cryptocurrency.
Express.co.uk CEO Kevin Murcko, Founder and CEO of CoinMetro said that “Ethereum’s technology is far more advanced than developers.”
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Ethereum’s blockchain is described as a decentralised, global computer. Many developers have created applications to it.
Ethereum is the center of decentralised finance and smart contracts.
Smart contracts can be described as legal documents that are automatically generated using a predetermined algorithm.
The revolution of global monetary governance is decentralised finance. It eliminates central banks and any other intermediaries.
Bitcoin and Ethereum are expected to increase in value relative to the inflationary dollar.
Experts predict that the US Dollar will fall due to the Federal Reserve’s continued stimulus programs. This is because of the economic downturn caused by the coronavirus pandemic.
Hamilton said: “In traditional market we’ve seen Fed voice possibility of tapering stimulus in September.”
Given the debt issuance over the past 18 months, an increase in interest rates could cause a ripple effect on the equity markets that can trigger a credit crunch.
Morgan Stanley is concerned that a 5 percent market drop from its current level could trigger a sell-off.
“I believe it is unlikely that the Fed will slow down on its stimulus programs.
It would be too risky for the US economy.
Global equities have, to date, recorded $605billion in inflows (1.01trillion annuallyised). This is 40 percent more than the previous 25 years.
Express.co.uk is not a financial advisor. This article was written by journalists who do not have cryptocurrency.
Publié Sun, 05 Sep 2021 at 14:57.08 +0000