Ethereum 2.0 Vs Bitcoin Market Cap

Can ETH 2.0 Surpass BTC in Market Cap?

Ethereum, the second-largest cryptocurrency by market cap is fundamentally very different from Bitcoin. Bitcoin enables the anonymous transfer of value from one user to another without a central entity like a bank. On the other hand, Ethereum is a general-purpose blockchain. Its primary purpose is to support limitless functions using smart contracts. These programmable contracts enable the use of blockchain to create self-governed applications and are an integral part of the Ethereum ecosystem.

Coming events are casting their shadows

One of the biggest and early signs of Bitcoin losing its throne to Ethereum appeared in June 2021. On June 29, Ethereum surpassed Bitcoin in terms of the total number of daily active addresses. This means more users were flocking to the Ethereum network in comparison to Bitcoin Network. This was a historic event as Ethereum was preparing for its transition to the advanced version of Ethereum 2.0.

What is ETH 2.0? How can it possibly lead to the market cap flipping?

A lot of things are happening around Ethereum to upgrade it to ETH 2.0. Here is the list:

Moving away from Proof-of-work consensus (PoW)

Ethereum 1.0, also known as Frontier launched with a PoW consensus mechanism in 2015. Since then, Ethereum underwent some more upgrades such as Homestead and Metropolis. The current phase known as Serenity initiated in 2020. Phase 0 of Serenity went live in December 2020.

Phase 0 delivered:

1) Beacon Chain — under testing since December 2020

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Phase 0 and Phase 1 bridging

Phase 1 of Serenity will start somewhere in the second half of 2021. Till the completion, both Ethereum 1.0 and 2.0 will work independently. Phase 1.5 will be completely about bridging the Ethereum 1.0 and 2.0 and the merging will be known as docking.

Final Touches — Phase 3

It’s expected that Serenity will reach the final stage of implementation by 2023. The final phase will involve the addition of extra shard chains on a need basis and the implementation of increased privacy and security.

Can all these upgrades lead to the Ethereum market cap surpassing the Bitcoin market cap?

Business applications of smart contracts on Ethereum are just beginning to grow. We have seen DeFi and NFTs explode in 2020 and 2021. While the current Ethereum network continues to be a major platform for DeFi and NFT development, it is not scalable and fast enough to sustain the growth of these two sectors.

DeFi, Crypto banking, White label cryptocurrency exchange development, Crypto wallet development, coin development, fintech, Blockchain