How the price of ETH will be worth more than BTC
3 min read
The price of ETH may surpass that of BTC. This is the view of Messari’s Ryan Watkins, who spoke about it on the Fintech Today podcast.
During the broadcast, when asked whether ETH may one day be more valuable than BTC, the analyst replied:
“I think it’s possible that one day ETH will be worth more than BTC. I don’t know if and when that will happen but I think it’s possible”.
According to Ryan Watkins, what will make ETH stand out enough to grab attention is the move to Proof of Stake, which is foreseen in ETH 2.0.
This will make the ETH blockchain more secure than that of BTC. Furthermore, with the transition to version 2.0, there will also be a change in ETH’s monetary policy which, according to Messari’s analyst, will not only become less inflationary than BTC, but even deflationary. Over the next few years, there will be fewer and fewer ETH because they will be burned, so the token supply will be reduced.
The economics of ETH will push the price to be worth more than BTC
What also suggests that ETH may soon surpass BTC in price and usefulness is its unique ecosystem for building applications to create digital goods and services.
Moreover, BTC is bound to run into difficulties. Ryan Watkins cannot imagine that BTC will be used as a means of payment and accepted by governments as if nothing happened. On the contrary, governments themselves might obstruct it for fear of losing their monetary sovereignty. ETH, on the other hand, does not aim to become a circulating currency. Nonetheless, it has its own economy, which is explained as follows:
“ETH is a bit different. The way ETH becomes a currency is not because it will be adopted by countries as a currency, but because it is building its own economy (…) and in this economy, there are financial institutions, technological institutions, art, and lots of things that people can do. These things produce value, people can make a living in this economy. So at a certain point, the ETH economy will start to attract so much capital, both human capital and financial capital that it will be a force in the global economy”.
In addition, thanks to stablecoins, which will be used to hold funds, ETH will also be able to solve the problem of market volatility.
For all these reasons, Ryan Watkins concludes:
“ETH is winning not because everyone is adopting it but because there is a lot of demand to pour money into its economy, people need Ether to spend money in its economy, it’s like if you go to a country and you need its currency. That’s the scenario that I think becomes possible and that will make sure in my opinion that at that point ETH will win and be worth more than BTC”.
Ultimately, according to the Messari analyst, BTC is destined to remain in a niche competing with gold and other assets, while ETH will prevail.
The post How the price of ETH will be worth more than BTC appeared first on The Cryptonomist.
