It seems that more and more people on the Internet have begun to discuss the possibility of Ethereum surpassing Bitcoin in the past few days.
The reason for this phenomenon, I think it may be related to two factors:
One is that the ecology on Ethereum is getting bigger and bigger; the other is that the price increase of Ethereum will have mechanism factors.
Let’s look at the ecological factors first, which mainly include the application level and the technical level.
From an application perspective, the two largest application areas currently are DeFi and NFT.
Among them, the lock-up value of Ethereum DeFi has reached 85 billion U.S. dollars at the time of writing, and it will be close at hand to break 100 billion U.S. dollars, which shows that DeFi has become more and more forming ecology.
Based on this, we can say that Ethereum has officially developed its own unique and complete application scenarios in the vertical direction from a platform that only had the function of issuing and speculating coins in 2017.
Although DeFi is developing in full swing, it is still limited to a certain small circle, and NFT is more influential than DeFi. We see a large number of people from different fields outside the circle (such as artists, sports stars, celebrities, auction houses, etc.) are actively active in this field, and the activity of these people will drive their fans into this field. The ecology of Ethereum is moving horizontally into the lives of more and more people.
This vertical and horizontal expansion has allowed Ethereum to finally “connect to the ground” and become the platform of the crypto world, becoming more and more three-dimensional and more tense.
The above is from the application level. If we look at the technical level, various ecological chains supporting EVM (such as Fantom, Binance’s BSC, Huobi’s HECO), and various second-layer extensions (such as Matic) are sharing Ethereum The burden of Ethereum will not curb its own ecological development due to the high handling fee. Although they have temporarily diverted the traffic of Ethereum, it is conceivable that once the cost problem of Ethereum is alleviated, the applications and users in these ecosystems will still return to Ethereum or revolve around Ethereum in some form.
Therefore, the development of these related ecosystems is actually in resonance with the Ethereum ecosystem. To a certain extent, they are also expanding the Ethereum ecosystem.
It can be said that looking at the ecology alone, there is currently no other chain that has the scale and vitality of Ethereum. It can be said that the direction of Ethereum is also the direction of the entire cryptocurrency. It represents the future, the trend, the value orientation, and the new consensus.
In this sense, it is certain that the Ethereum ecology and the development of Ethereum itself surpass Bitcoin.
I actually shared this view in an article last year. If we think of Bitcoin as gold and Ethereum as oil. The future development trend of Ethereum is not difficult to understand: the volume of oil must be larger than that of gold, because oil carries human industrial civilization and carries the world’s every minute and every second. Without oil, we cannot see today’s industrial civilization; without Ethereum, we cannot see the future of the crypto world.
These are comparisons between Bitcoin and Ethereum from the perspective of ecological development, but the other thing that attracts people’s attention is the price. The one that stirs this nerve is the upcoming EIP1559. I have shared this topic many times. Its most important impact is to change Ethereum from its current inflationary state to its future deflationary state. From the most conservative point of view, even if it is not deflationary, the total amount of Ethereum will remain at 100 million. Between the number of pieces to 130 million pieces.
If 4 years ago, Ethereum was in a deflationary state, we would immediately think that once the price of Ethereum in a deflationary state rose, the ecology would be finished. Therefore, Ethereum at that time did not have such room for price imagination. But today is different. We have a variety of related ecological chains and a second level of expansion. In those ecological chains and expansions, the ecological application of Ethereum can be unimpeded, and the transaction fee is close to zero. Therefore, today’s Ethereum has broken away from the shackles of price to some extent, and 1559 has provided a fundamental mechanism for price increases.
So far, the upside of the Ethereum price has been completely opened up.
The development of the ecology is vigorous and the price rise is unfettered. Of course, such Ethereum has given people a lot of room for imagination.
So will the market value of Ethereum exceed that of Bitcoin? I think it will. Of course this is not to say that I look down on Bitcoin. The position of Bitcoin can never be shaken, but if we look to the future with an open and inclusive mind, if the market value of Ethereum cannot surpass Bitcoin, where is the future of the crypto world?
If at today’s price, Bitcoin is 50,000 US dollars, and the market value of Ethereum exceeds that of Bitcoin, then its price should reach at least 10,000 US dollars.
Author/ Translator: Jamie Kim
Bio: Jamie Kim is a technology journalist. Raised in Hong Kong and always vocal at heart. She aims to share her expertise with the readers at blockreview.net. Kim is a Bitcoin maximalist who believes with unwavering conviction that Bitcoin is the only cryptocurrency – in fact, currency – worth caring about.