Ethereum 2.0 Could Overtake Bitcoin, Messari Analyst Predicts

Messari analyst Ryan Watkins argues that ETH's market cap could exceed that of BTC once the switch to Ethereum 2.0 and Proof-of-Stake is complete.

March 18, 2021 | AtoZ Markets – Ryan Watkins, Senior Research Analyst at research firm Messari, said Ether (ETH) could overtake Bitcoin (BTC) and become the most important crypto asset once the transition to Eth2 and Proof-of-Stake (PoS) is completed.

On March 18, a guest on the YouTube show "FinTech Today", Watkins stressed that he did not know " if and when " Ether will overtake Bitcoin. However, in his opinion ETH has the potential to become the leading crypto asset thanks to the introduction of Eth2:

"The strength of Bitcoin over Ethereum is that it is a store of value, given its very predictable monetary policy and the high level of security offered by its blockchain. I think with the transition to Eth2 and Proof- of-Stake, [...] Ethereum could potentially become more secure than Bitcoin. "

Watkins also pointed out that, with the transition to version 2.0, Ethereum will also change its economic system: the imminent introduction of a  burn mechanism will ensure that ETH is destroyed at a faster rate than supply creation.

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"The monetary policy of Ethereum will change with Eth2, so that it will not only be less inflationary than Bitcoin but even deflationary. Therefore, year after year there will be less and less Ether, as they will be gradually burned. [...]

If Ethereum is safer and has better monetary policy, what are the arguments in favor of Bitcoin in this scenario? "

Watkins also highlighted the "huge" and "diverse" economy forming on 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 capital, that it becomes a major player in the global economy. Ethereum's GDP is already rivaling many large countries. [...]

People can actually make a living in this economy. "

According to Blockchain Center's Flippening Index, a website that measures the strength of Ethereum versus Bitcoin based on eight different metrics, Ethereum has now come 65.6% of the way to overtake Bitcoin. In February, an all-time high of 72.3% was reached.

The Index argues that Ethereum has already surpassed Bitcoin in terms of nodes, number of transactions and  overall commission value.

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