Recently, the price of Ethereum (ETH) has been rising more than that of Bitcoin (BTC). This trend suggests a possible flippening of Ethereum relative to BTC.
The flippening of Ethereum against Bitcoin
During Bitcoin’s previous cycle, starting around mid-December of the year after the halving, a large speculative bubble began to inflate on the price of altcoins – and particularly on ETH – just as the bubble on BTC was about to burst.
Moreover, there are more and more use cases for Ethereum.
In light of these considerations, according to GlobalBlock CEO Rufus Round, the flippening of Ethereum against Bitcoin is becoming a little more likely.
What is the flippening
Flippening refers to ETH overtaking BTC in market capitalization.
Right now the market capitalisation of BTC is just under a trillion dollars, while that of ETH is over five hundred billion. In other words, all existing ETH in the world as a whole are worth just over half of all BTC.
This gap was much greater in the past.
Measured in the form of dominance, ETH currently accounts for about 21% of the entire crypto market capitalization, while BTC accounts for 38%.
At the beginning of the year, however, ETH was stuck at 10%, while BTC had shot up to 68%. So while at the start of the year Bitcoin as a whole was worth around seven times Ethereum, over the months this gap has narrowed to below two times.
However, it is worth noting that by mid-May ETH’s dominance had risen to 19.5%, while BTC’s had fallen to 39%, so the current situation is very similar to that of around seven months ago.
However, Round himself says that these are two completely different assets, so that such a direct comparison would be unfair. He also states that the price of BTC by the end of the year could also increase, which could also increase the current gap with ETH.
BTC and ETH on two different paths
Indeed, taking a cue from what is happening these days, GlobalBlock’s CEO argues that BTC and ETH are somewhat separating.
Up until now, the races of the two cryptocurrencies have always seemed very tied together, but in fact for the past few days it seems that ETH is able to carve out more independence from BTC’s price fluctuation.
Furthermore, Round claims that the explosion of the DeFi market, and Ethereum’s ever-expanding use cases, are in fact expanding its adoption to the point where it can somehow disengage from Bitcoin.
The basic differences between these two protocols could in fact in the future give them the possibility to go their separate ways, without necessarily one affecting the other. To date, this is not yet the case, but there are beginning to be indications of a possible evolution in this direction.