Ethereum capitalization is higher than bitcoin: what is cryptocurrency flipping and when to expect it
Now the total value of Ethereum in circulation is about $483 billion. This is much less than that of Bitcoin - $964 billion. But some analysts argue that ETH will overtake BTC in terms of capitalization and become the #1 crypto in the world. And it will happen very soon.
Ethereum has long and firmly occupied an honorable second place in the world ranking of cryptocurrencies.
Now ETH is fluctuating around the $4,000 mark, while Bitcoin is confidently holding above $50,000. The difference in capitalization is also huge. Despite this, experts are confident that the total capitalization of ether will exceed the capitalization of bitcoin. This process has already begun and is gaining momentum.
For an event that will have a great impact on the cryptocurrency market, a special term has been coined – flipping. Let us consider in more detail whether it is really possible and how soon to expect it.
The concept of flipping
From the point of view of cryptocurrencies, flipping is the moment when the capitalization of Ethereum coins will be greater than that of Bitcoin. That is, virtual money will change places in the world ranking and ETH will take a leading position. For beginners, let’s clarify that capitalization is the total number of coins in circulation, multiplied by their current rate.
Talk about the possibility of flipping has been going on since the launch of the Ethereum blockchain. And they are renewed every time the price of bitcoin drops significantly. True, at the same time, no one mentions that the cost of other coins “falls” along with it.
Note that the term “flipping” may apply to other competing coins as well. For example, memcoins DOGE and Shibu Inu. But in this article we will only talk about ETH and BTC.
Reasons for possible flipping
Now the change of leaders seems impossible. Just to catch up with bitcoin, Ethereum will have to gain about another $500 billion in capitalization. But analysts consider it possible, since ETH is a more promising instrument than its competitor. The Ethereum blockchain supports smart contracts , with which you can create distributed applications. In addition, it is on the basis of the ether blockchain that the well-known and popular now NFT tokens function .
The main factor is the upcoming transition of Ethereum to the second version algorithm, which uses PoS consensus (unlike Bitcoin’s PoW). That is, for the formation of new blocks in the chain and the emission of coins, there will be no need for mining, which “eats up” megawatts of electricity.
The flipping process has already begun, although some do not notice it. Here are its signs:
- The dynamics of the growth of the Ethereum exchange rate has exceeded 500% for the current year. Bitcoin increased in price by 130% over the same period (excluding the last drop that occurred in early December).
- According to the Coinbase crypto exchange, the number of transactions with ethereum for the third quarter of this year was 22% compared to 19% for bitcoin. Moreover, this is the second reporting period when ether overtakes its competitor in terms of trading volume.
How progress is tracked
There are specialized resources on the Internet that monitor various parameters of the operation of the bitcoin and ether blockchains. Then they compare them and show in percentage terms what the difference is between the competitors.
The most important are the following indicators:
- Capitalization — now ETH lags behind BTC by 50.2% in this parameter. That is, you need to go another half way to the cherished date. “Capitalization progress” is calculated as the sum of all the parameters listed below.
- Number of active addresses — the service compares the number of wallets from which transactions with cryptocurrency are constantly carried out. Now Ethereum is 37% behind Bitcoin, but this figure is constantly increasing.
- The number of transactions is the number of transactions that were made over the past period with a particular cryptocurrency. According to this monitored parameter, ether has not only caught up, but also overtaken its competitor.
- The cost of transactions – unlike the quantity, the sum of all transactions made with ether is 25% less than bitcoin. But this indicator continues to increase, and in some past periods it exceeded the mark of 200%.
- The amount of the commission paid for conducting transactions – according to this indicator, the second-ranked cryptocurrency has long and greatly overtaken the first. The excess has long been more than 5000-7000% percent, which indicates the active use of coins for various financial transactions.
- Interest in Google is the only parameter in which Ethereum is far behind Bitcoin. The difference is 76%. That is, Internet users are much more interested in news and topics related to bitcoin.
Projected date of flipping
In some respects, Ethereum has already overtaken its competitor, that is, some flipping has already occurred. But it is necessary to wait for the main event – a higher capitalization of the coin. No one can name the exact date of this event, since hundreds of factors influence it.
Cryptocurrency billionaire Raul Rai believes that flipping will happen in the next 6 months of next year. Trader Michael van de Poppe gives more modest forecasts. He believes that you need to wait at least 9 months. Moreover, it is necessary that the current uptrend is constantly maintained. Another analyst – Mike Maglon – does not name the exact date, but also believes that this should be prepared for next year.
What is the result
The capitalization of ether, according to the majority, can exceed bitcoin, but flipping cannot be guaranteed by 100%. The reason for this will not be the strengthening of the position of BTC, but the appearance on the market of a new alternative crypto with even greater opportunities.
For example, Solana is considered one of the most promising options . Its blockchain works at a very high speed (17 operations per second for ETH and 60 thousand for SOL). But Solan also has its competitors. So the situation in the cryptocurrency market is becoming more and more interesting. Stay connected so you don’t miss important news