Even if the flippening does happen, it wouldn’t have a huge impact on Bitcoin’s status as a store of value, analysts said.
Some say that ‘the flippening‘ is a horror film name, but it’s really a topic of considerable discussion in the crypto world. As Ethereum nears its switch to proof-of-stake, it has become more prominent than ever before, particularly as concerns grow that it will become a deflationary asset after the change.
ETH Will Flippen Bitcoin (BTC)
There is certainly a lot of discussion on the issue of ‘the flippening’, particularly when it can mean more than one thing. However, there is general consensus that ETH will flippen bitcoin (BTC), even if there are a lot of disagreements as to when it will become more valuable as a market capitalization.
Even if the flippening does happen, commentators generally agree that it wouldn’t make Bitcoin a less important store of value, as described above.
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What does the flippening mean?
According to Josef Tetek, Brand Ambassador at SatoshiLabs and Trezor, the ‘flippening’ of bitcoin has been around since at least 2017, when it referred to the fact that Ethereum would become the number one cryptocurrency on coin ranking sites such as CoinMarketCap.
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In order to flip ETH over to BTC, the market value of ETH must rise above BTC 0.156 per unit, but at the time of writing, it stands at around 0.0774. If BTC stays the same, then ETH should more than double in price, but the market value of BTC must rise. As such, Tetek does not believe a flippening in this sense “will ever” take place.
“Since June 2017, Ethereum has dropped to a price of ~0.14 bitcoin,” he said.
People employed in other sectors of the economy are more sanguine about the flippening. They believe it is unlikely in terms of market capitalization, but nevertheless possible.
According to some people, because Ethereum will be deflationary following the Merge, it will then have the same qualities as bitcoin – which are scarcity and gas for a settlement layer – allowing it to become as valuable as bitcoin eventually.
Even after the Merge, Ethereum might be the predominant ‘cash-like’ settlement layer for much of the crypto ecosystem, according to Jeffrey.
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The Ethereum Boom Is Not Over Yet
Despite what Ho said, the Ethereum boom is not over yet. Avalanche, BNB, Solana, Fantom, and others are fast, cheap, scalable, and here now, and Ethereum still has a long way to go.
In other words, ‘flippening’ doesn’t always mean that Ethereum overtakes bitcoin in terms of market cap. It can also mean different things such as daily trading and volume, as well as other factors.
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Ethereum Flipping Bitcoin – What Is Possible?
According to Mr. Lee, the recent ether flip represents the first time that bitcoin options have been worth anything since 2011 when the market was worth more than USD 5.7 billion.
We may need to update our ideas of what is possible as the Merge draws near in order for Ethereum to gain momentum, according to Bjelic.
It is possible that Ethereum might flip Bitcoin from a notable to an important player in the blockchain industry, in addition to flippen Bitcoin in terms of popularity and importance. Bitcoin is the pioneer project that is crucial for the industry, and as such, it is extremely crucial, but the amount of innovation, use cases, and adoption happening in Ethereum might easily make it the leading project and the first association in the blockchain industry, according to the researcher.
What will happen to Bitcoin if Ethereum overtakes it?
How would a flippening of Ethereum affect Bitcoin, if that were possible? Would any flippening affect Bitcoin’s value or standing?
According to Mark Jeffrey, both Ethereum cryptocurrencies and platforms serve two very different economic functions, so adding more value to Ethereum would not diminish Bitcoin.
In the future, Bitcoin’s proof-of-work might become even more valuable for its imperviousness and security than it is now, he said.
According to Mihailo Bjelic, Bitcoin’s inherent value lies in its potential to be a quasi-gold standard and store of value.
“The fact that Ethereum is propping up the DeFi and NFT ecosystems, as well as many other interconnected platforms, is more about Ethereum increasing in value than Bitcoin losing its value,” he said.
Josef Tetek is of the opinion that proof-of-stake is not as robust as proof-of-work in regards to Bitcoin, and he sees that as a major problem.
“I believe that because Ethereum is not sufficiently decentralized and permissionless, and because it will be converted to a proof-of-stake consensus mechanism if it moves forward with its planned transition, I fear that it will become even more susceptible to a regulatory capture,” he said.
How the crypto community deals with the update will directly affect the future of crypto
A crypto ecosystem flippening could have a positive or negative impact on Bitcoin, but it could have a range of consequences for the wider crypto ecosystem.
According to Mihailo Bjelic, if a ‘flippening’ occurred, it might reduce the appeal of Ethereum competitors by reducing the number of layer-1s (base protocols), such as Polygon. In the past, Bjelic believes that cryptocurrency was only used as a single popular use case. He believes that such a shift would be beneficial for the industry.
Mark Jeffrey also points out that a flippening would be a positive thing for crypto, as it would ultimately lead to more usage and adoption of Ethereum. The crypto market, on the other hand, tends to rise and fall more or less as a whole. It would likely increase usage and adoption across the board.
A successful crypto ecosystem increases everyone’s welfare – in addition to increasing adoption and innovation. For example, some individuals will always value bitcoin’s better security – because of ethereum’s greater popularity, some percentage of people will always store their winnings in bitcoin for increased security.
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