A well-known economist predicts the market capitalization of Ethereum may exceeds BTC
12.12.2020 • Просмотров:

A well-known economist predicts the market capitalization of Ethereum may exceeds BTC

By bit.team

Legendary investor Raul Pal has made some bold statements about Ethereum, suggesting that its market capitalization could surpass that of Bitcoin over the next decade.

Can Ethereum really surpass Bitcoin?

Global Macro Investor CEO Raul PAL listed a number of reasons why Ethereum could significantly outperform Bitcoin in terms of market capitalization in the future. At the moment, the market capitalization of Ethereum is only 18% of the market capitalization of Bitcoin, with 62 billion compared to 334 billion dollars.

Today, an investment strategist and economic historian in a flurry of tweets compared the size of cryptocurrencies to traditional financial markets such as bonds and derivatives. All the noteworthy comments were very optimistic for the Ether, on which the entire financial economy can work in the future.

“I assume that BTC is the ideal collateral level, but ETH may be larger, in terms of market capitalization in 10 years, for the reasons mentioned above”.

Bitcoin, which is currently being adjusted, is traditionally considered a means of saving, rather than digital money or a level of financial applications. Sending and receiving Bitcoins is relatively slow, and the markets are still too volatile to be considered “money”.

Ethereum prices are also unstable, and It can also suffer greatly when the network is under heavy load. The difference is that many other assets, from stablecoins to real estate, and non-interchangeable game tokens, can be tokenized to Ethereum. This is the Foundation for an entirely new financial landscape.

Pal started the discussion by stating that if Bitcoin is a flawless digital security, the size of the global government bond market is $ 123 trillion, and this could be “a pretty amazing opportunity for Bitcoin.”

He then compared cryptocurrency markets to current settlements, derivatives, and Forex levels in traditional Finance, which are estimated at quadrillions of dollars.

“Almost no one in cryptocurrency understands the true size of financial markets. It never happens that the winner gets everything. This is almost impossible since each blockchain has its own limitations and trade-offs, and this corresponds to the complexity of the financial world”.

He added that money and bonds are only the basic level, and everything is built on the top. He stated that the means of saving is collateral, the level of trust and exchange of values is greater, and this is Ethereum.

It’s all about DeFi

Decentralized Finance was a major event in 2020, as most of it is built on Ethereum, despite the emergence of a number of faster competing blockchains such as Polkadot, Solana, and Binance Smart Chain.

None of them managed to” kill ” Ethereum, and they are unlikely to be able to do so in the future, unless developers in the current DeFi ecosystem want to rewrite all their code and contracts for another platform with fewer users.

As DeFi grows, so will its dependence on Ethereum which is also evolving and is already being scaled using layer 2. Native scaling will occur in about a year, and by that time, Ethereum will have further established Itself as the base level of this new financial world.