Messari analyst Ryan Watkins argues that once Ethereum 2.0 and Proof-of-Stake are completed, the market value of ETH may exceed BTC.
Ryan Watkins, Senior Research Analyst at research firm Messari, said that Ether (ETH) could surpass Bitcoin (BTC) and become the most important crypto asset once the transition to Eth2 and Proof-of-Stake (PoS) is complete.
Watkins, who was a guest on the YouTube show “FinTech Today” on March 18, emphasized that “he does not know when Ether can surpass Bitcoin. However, according to him, ETH has the potential to become the leading crypto asset thanks to the launch of Eth2:
Considering Bitcoin’s strength over Ethereum, its predictable monetary policy and the high level of security offered by the blockchain, it is a store of value. I think with the transition to Eth2 and Proof-of-Stake, […] Ethereum could potentially become more secure than Bitcoin.
Watkins also stated that with the transition to version 2.0, Ethereum will also change its economic system: The introduction of a combustion mechanism soon will allow ETH to be destroyed at a faster rate than supply creation.
Ethereum’s monetary policy will change with Eth2 so that it will not only be less inflation than Bitcoin, but even deflationary. Therefore, over the years there will be less Ether as these will be burned slowly. […]
If Ethereum is more secure and has better monetary policy, what are the arguments in favor of Bitcoin in this scenario?
Watkins also underlined the “massive” and “diverse” economy in Ethereum, arguing that the decentralized application industry will attract new users at a faster rate than Bitcoin:
At some point the Ethereum economy begins to attract so much capital, both human and financial, that it becomes a major player in the global economy. Ethereum’s GDP is already rivaling many major countries. […]
People can actually make a living in this Ethereum economy
Ethereum has now reached 65.6% of its path to beating Bitcoin, according to the Blockchain Center Flippening Index, a website that measures Ethereum’s strength against Bitcoin based on eight different metrics. The all-time high of 72.3% was reached in February.
The index argues that Ethereum has already surpassed Bitcoin in terms of nodes, number of transactions, and overall commission value.