‘Deflationary’ Eth2 could flip Bitcoin: Messari analyst

Ryan Watkins, a senior research analyst at crypto analytics firm Messari, has speculated that Ethereum could overtake Bitcoin as the largest crypto asset once the Eth2 and proof-of-stake overhaul is complete.

Watkins, who appeared on Youtube show ‘FinTech Today’ on March 18, noted that while Ethereum doesn’t know if or when Ethereum will flip Bitcoin, he believes Ether will become the leading crypto asset in the future because of Eth2 could be ::

“Bitcoin’s sales argument over Ethereum as a store of value means that monetary policy is very predictable and the Bitcoin blockchain is very secure. I think that with the switch to Eth2 and Proof-of-Stake […] Ethereum may even be more secure than Bitcoin. “

Watkins also highlighted the changing underlying economics of ether during the Eth2 transition, highlighting expectations that Ethereum’s impending combustion mechanism will result in ether being destroyed at a rate beyond the creation of a new offering.

Ethereum’s monetary policy will actually change in Eth2 so that it is not only less inflationary than Bitcoin, but also deflationary. So every year there is less and less ether because it is burned. “

He asked the question, “If Ethereum is more secure and it is [has] stronger monetary policy, then what’s the bull case for Bitcoin in this scenario? “

Watkins also noted that a “massive” and “diverse” economy is being built on Ethereum, suggesting that the network’s booming decentralized application sector will attract new users faster than Bitcoin over time.

“At some point, Ethereum’s economy attracts so much capital, both human and financial capital, that it is actually a force in the global economy,” he said. Ethereum’s GDP actually competes with many large countries. ”

“People can make a living in this economy,” he added.

According to the Blockchain Center’s “Flippening Index”, which uses eight metrics to measure the strength of Ethereum compared to Bitcoin, Ethereum is currently 65.6% as strong as Bitcoin – after hitting an all-time high of 72.3% in early February had achieved.

The index indicates that Ethereum has already overtaken Bitcoin in terms of number of nodes, number of transactions, and total transaction fees.