BitDegree.org does not endorse or suggest you to buy, sell or hold any kind of cryptocurrency. Before making financial investment decisions, do consult your financial advisor. It’s a fun metric to explore, said Lex Sokolin, the global fintech co-head and head economist at ConsenSys, in an email. But they actually both perform very different functions, bitcoin as a store of value and ethereum as a technology platform, he added.
What is The Flippening?
However, bear in mind that a flippening scenario doesn’t necessarily mean Ethereum price would go up. This flip in market cap could still play out even if Ethereum falls in value but Bitcoin’s value falls by an even greater percentage. Basically, it’s wise to exercise caution here since a potential flippening doesn’t make Ethereum a good investment. Given this dynamic, a faster-growing price of ether (the native currency on the Ethereum blockchain network) in relation to Bitcoin would help make the flippening occur. Or, Ethereum’s price simply outperforming Bitcoin over time (even if the price of both were to decline) could also cause a flippening. Despite a more than six-year head start for Bitcoin, Ethereum quickly skyrocketed into the No. 2 position in terms of largest cryptos on the market.
History of the Term “Flippening”
Its limited supply, in addition to its simplicity and acceptance makes it increasingly attractive to institutional investors. Mati Greenspan, senior markets analyst at asset trading platform eToro, spoke to this potential. Still, projects using this method of fundraising are going to sell some of the ether tokens they raise to pay for development, he said, meaning sell pressure could increase should this begin in earnest.
Depending on the outcome, it could lead to further growth and adoption of digital assets as well as a new Forex broker bonus era for the cryptocurrency industry. It also has the potential to shake up the current market dynamics and bring about dramatic changes in the value of different cryptocurrencies. No matter what happens, it is certain that any flippening will be an event that is talked about for years to come.
- There can never be more than 21M bitcoins of which over 19M have already been minted.
- “If ethereum’s pace of 2021 price appreciation stays the same versus bitcoin, the market cap of No. 2 will flippen No. 1 toward the end of 2022.”
- Imagine you are playing a game of musical chairs and the person who sits in the leader’s chair changes each time the music stops.
Ethereum
While it’s difficult to predict precisely when or if the Flippening will occur, it’s clear that both ETH and BTC have strong support and could potentially continue to jockey for the top spot. Ultimately, the outcome of the Flippening will depend on various factors, including the price of each cryptocurrency, adoption trends, and investor sentiment. Regardless of the outcome, investors and cryptocurrency enthusiasts must keep an eye on the Flippening and stay informed about the latest developments in the market. Market cap is an essential metric for investors and analysts because it gives them a sense of the size and value of a company or asset. In the case of cryptocurrencies, the market cap can also be a good indicator of adoption and demand. Generally, the higher the market cap, the more people are interested in a particular cryptocurrency and the more valuable it is perceived to be.
Flippening is a perfect scenario for Ethereum fans because it is speculated that the total Ether market cap could 38 5 swedish krona to british pound sterling, convert 38.5 sek in gbp outweigh the total Bitcoin market cap. The term was crafted in 2017 to describe a potential situation in which Ether might become the largest cryptocurrency in the world. However, he also noted that this analysis ignores the rise of ethereum challengers and bitcoin as a monetary innovation, which typically has sticky network effects.
In the long-term though, most crypto investors don’t see significant market implications from the flippening. As bitcoin hovers near record highs, pulling up the rest of the cryptocurrency complex with it, analysts are anxiously awaiting a rather ominous-sounding event non-fungible token nft: what it means and how it works – “the flippening”. The Transaction Count shows the relation of total on-chain transactions on the network (100% means Ethereum has flipped Bitcoin in that metric). The Flippening is crucial because it would represent a significant shift in the cryptocurrency landscape. If ETH overtakes BTC as the largest cryptocurrency, it will signal a change in investor sentiment and adoption patterns. It could also indicate a shift in the overall direction of the cryptocurrency market.
This would make those offerings open, transparent and accessible to all without the need for middlemen. Examples of financial products include lending services, exchanges, derivatives and insurance. A smart contract is a set of instructions written in computer code that runs automatically all parts of an agreement and may be used to automate the agreement between parties. This completely removes the need for an intermediary since the outcome is pre-determined. DApps are digital applications deployed on a blockchain or a peer-to-peer network of computers as opposed to a central server. This ensures that the applications are not controlled by a single entity or authority and instead, are community-driven.
