In the height of 2017-2018, the discussions centered on whether Tron could eclipse Ethereum as the second largest cryptocurrency. However, as time has passed, such comparisons have fallen by the wayside.
Ethereum reigns supreme in the realm of smart contracts, but that hasn’t stopped market watchers from measuring it against Bitcoin, the reigning champ of cryptocurrencies.
Is Ethereum on Track to Surpass Bitcoin?
An individual on platform X recently stated that it’s only a matter of time before Ethereum surpasses Bitcoin in the crypto hierarchy. The analyst referenced several reasons suggesting that Ethereum is well-positioned to outpace the progenitor cryptocurrency, noting advantages such as its larger user base and the innovative functionalities that smart contracts offer.
CoinMarketCap figures show that, as of writing on May 28, Bitcoin boasts a market capitalization exceeding $1.3 trillion, and each unit is priced above $68,000. Ethereum securely occupies the runner-up slot.
Despite its status, Ethereum has been outperforming Bitcoin recently, with each Ether trading over $3,800 and holding a market cap above $465 billion.
In direct comparison, Bitcoin is roughly triple the market value of Ethereum. Nevertheless, due to its pioneering status, one commentator believes Ethereum’s features surpass those of Bitcoin.
For instance, Ethereum is said to attract a more extensive user base owing to its capacity to support third-party protocols. High-profile applications like Uniswap and Aave accrue more in daily transaction fees than Bitcoin. Furthermore, Ethereum is recognized not only as a means of exchange but also as a valuable store of wealth — enhancing its appeal over Bitcoin, which serves primarily as a payment network that facilitates secure, low-cost international transactions.
Another point raised is the accessibility of engaging with Ethereum’s network. Currently, over 1.9 million Ethereum validators have staked at least 32 ETH to participate in network validation and earn rewards — a process far more straightforward than setting up a Bitcoin mining operation, which necessitates expensive, specialized hardware that’s often difficult to acquire.
Anticipation Surrounds Ethereum ETFs and Security Classification
The prospect of the U.S. Securities and Exchange Commission (SEC) greenlighting Ethereum-based exchange-traded funds (ETFs) is viewed positively, but Ethereum’s classification as a commodity or a security remains uncertain. Contrarily, Bitcoin enjoys a more definitive status as a commodity.
The SEC has yet to categorically label Ethereum as a security, though litigation from ConsenSys suggests the agency may implicitly regard it as such. This stands in opposition to the perspective of the Commodity Futures Trading Commission (CFTC), which identifies Ethereum as a commodity.
Despite ongoing debates, if the commission accepts a form S-1 registration for Ethereum, it could indeed be an indirect acknowledgment of Ethereum as a commodity.
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