Killer Whale Crypto
July 28, 2021, 7:26 AM UTC
This article explains why Ethereum may eventually become the world's predominant cryptocurrency
In this article, we will discuss why Ethereum may eventually overtake Bitcoin as the worlds predominant cryptocurrency.
Bitcoin currently encompasses more than half of the total value of cryptocurrency. Although Bitcoin was not the first cryptocurrency created, it behaves as if it has the first mover advantage. Bitcoin is at the front of the pack because it offered the first opportunity for investors to participate in a decentralized marketplace. In a sense, Bitcoin defined DeFi.
Although Bitcoin is currently the standard for cryptocurrency, it has some shortcomings when you compare it to many other cryptocurrency projects. Bitcoin’s greatest competition is Ethereum. This is old news for anyone who has dabbled in cryptocurrency for even a day. Ethereum is a far more functional cryptocurrency than Bitcoin. Ethereum is the first successful multi-layered cryptocurrency, because it allows users to create smart contracts on its blockchain. Ethereum has shown the world how powerful decentralized finance and decentralized applications (Dapps) can be.
Where Does the Value of Ethereum Come From?
Ethereum is valued by the vast number of smart contracts and Dapps which it's blockchain hosts. The Ethereum blockchain tackles many of the same goals that the websites and applications hosted on traditional local internets aim to accomplish. What makes Ethereum different from the traditional web, is that Ethereum applications are built directly on the blockchain, rather than being built on a second application layer, which only utilizes the functionality of the underlying protocol.
Consider how websites and applications work on top of the TCP/IP protocol, which make the World Wide Web a reality. The TCP/IP protocol only acts as a thin layer for these applications to be built on. Although the TCP/IP protocol is the fundamental building block of the internets that make up the World Wide Web, it has failed to capture the value of the websites or applications that it hosts. Most of the value which exists on the World Wide Web, lies within each website or application that it hosts. Essentially, the application layer is massive, while the protocol layer is incredibly thin. Ethereum on the other hand, has a massive protocol layer. The applications created on Ethereum are tied directly into the Ethereum blockchain. This in turn adds to the bullish nature of the ETH token.
Although Bitcoin and Ethereum have many similarities, Ethereum has a fighting chance at becoming the world’s predominant cryptocurrency. Bitcoin continues to hold tremendous value, however it may eventually drop into second place, behind Ethereum. the biggest driving factor for the evolution of cryptocurrency does not lie in its price action, but how the technology behind it can be adopted into everyday life.
When Bitcoin inevitably passes the torch, it is likely that Ethereum will be the one to take its place.