Ethereum will not quickly overthrow Bitcoin, but Ordinals may change the game.

While Ethereum won't dethrone Bitcoin overnight, Ordinals could potentially disrupt the game.

Author: David Canellis, translated by Shanoubba, LianGuai

The block space of Bitcoin looks set to be the hottest commodity in the world of cryptocurrencies.

Bitcoin has once again dominated the entire cryptocurrency market, almost doubling Ethereum’s performance since the beginning of 2023. Now, the predicted “flippening” of Ethereum surpassing Bitcoin seems even further away.

Currently, Bitcoin is valued at three times that of Ethereum. Bitcoin’s market cap is $727 billion, having increased by $400 billion in 2023 alone, a figure that exceeds the entire stock valuation of Mastercard and is about twice that of Netflix. Ethereum’s valuation has grown from less than $145 billion in January to nearly $245 billion today. Some predict that despite Bitcoin’s half-century head start, Ethereum’s market cap will one day surpass Bitcoin. Emerging from the bear market in 2019 and entering the explosive bull market of 2021, the outlook appears promising. DeFi summer and the NFT craze have fueled interest in Ethereum, sometimes resulting in transaction fees exceeding $250.

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• At the end of 2019 (the bottom of the bear market), Bitcoin’s market cap was 925% of Ethereum’s – $1.3 trillion compared to $140 billion.

• By the end of 2021 (the peak of the bull market), this number had narrowed to less than 200%.

• Bitcoin’s market cap is 300% of Ethereum’s.

The prospects of achieving the “flippening” have recently been dealt a blow by different reversals: for the first time since December 2020, the Bitcoin network now surpasses Ethereum, becoming the blockchain with higher user-paid fees.

In the past four days, Bitcoin users have paid miners approximately $40 million to process their transactions.

Meanwhile, Ethereum users have paid less than 27 million Ether (of which most of the fees have been burned, slightly reducing Ethereum’s total supply). Layer-2 Ethereum networks Arbitrum and Optimism have yet to bridge this gap, as their daily fees are less than $200,000. This fee reversal (or fee escape?) looks awkward considering the wide range of use cases supported by Ethereum. Decentralized exchanges, DAOs, popular tokens, NFTs, stablecoins, DeFi, and GameFi all operate on Ethereum.

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