- The cryptocurrency market is abuzz with discussions about Ethereum’s potential to surpass Bitcoin.
- Analysts are weighing in on the strengths and weaknesses of both cryptocurrencies.
- One notable quote suggests that Ethereum’s larger user base and smart contract capabilities give it an edge.
Explore the ongoing debate about Ethereum’s potential to overtake Bitcoin in the cryptocurrency market.
Will ETH Finally Flip BTC?
Taking to X, one user claims that Ethereum only needs time to flip Bitcoin as the crypto leader. Citing multiple factors, the analyst said Ethereum is better placed to take over from the first cryptocurrency, pointing to, among others, the larger user base and the benefits smart contracts bring to the equation.
Looking at CoinMarketCap data, Bitcoin has a market cap of over $1.3 trillion, with each coin trading for over $68,000 at spot rates when writing on May 28. Meanwhile, Ethereum is perched at second.
Although it has been one of the top performers in the last week, stretching gains versus Bitcoin, each coin is changing hands for over $3,800. It has a market cap of over $465 billion at this level.
Comparing Market Caps and User Bases
Comparing the two, Bitcoin is roughly three times more valuable than Ethereum. Even with the larger market cap, derived from its first mover advantage, one analyst thinks Ethereum is superior.
For instance, the observer said Ethereum has a significantly larger user base than Bitcoin. The broader user base is because developers can launch protocols on the platform. Some of the most popular ones, like Uniswap and Aave, generate more daily fees than Bitcoin.
Ethereum’s Versatility and Infrastructure
Besides this, the analyst said Ethereum serves as a store of value and a medium of exchange. These features give it more edge than Bitcoin, which purely exists as a transactional layer for moving value trustlessly and cheaply across borders.
From an infrastructure perspective, the analyst argues that being an Ethereum validator is easier than running a Bitcoin mining rig. Over 1.9 million Ethereum validators have staked at least 32 ETH for a chance to validate a block of transactions and earn rewards. On the other hand, Bitcoin mining requires specialized hardware. Mining rigs are usually expensive and scarce.
Spot Ethereum ETF Listings Approval And The Security Question
While the United States Securities and Exchange Commission’s (SEC) decision to approve spot Ethereum exchange-traded fund (ETF) listing is bullish, whether ETH is a security or a commodity remains to be clarified. Bitcoin, by comparison, enjoys a clearer designation as a commodity.
The United States SEC has not explicitly declared ETH a security. However, ConsenSys recently sued the agency, claiming they considered ETH a security internally. There is a clash since the Commodity Futures Trading Commission (CFTC), a sister agency to the SEC, categorizes ETH as a commodity.
Even as the debate rages on, analysts claim it would be endorsing ETH as a commodity if the commission approves form S-1 for registration.
Conclusion
The debate over whether Ethereum can surpass Bitcoin as the leading cryptocurrency is ongoing. While Ethereum boasts a larger user base and versatile applications, Bitcoin’s first mover advantage and clear commodity status provide strong competition. As regulatory bodies continue to deliberate on Ethereum’s classification, the market remains watchful of future developments.
