The crypto market turmoil in May sparked a debate over whether Ether could one day outperform Bitcoin in capitalisation.
Now, the largest digital currency has more than doubled its capitalisation of that of Ether, but the gap narrowed by about $350 billion in May, as Bitcoin losses were much larger than those of Ether.
What Ethereum fans support
Ether fans cite its popularity for providing blockchain-based financial services as well as an ongoing upgrade of its Ethereum network to boost its efficiency.
Ether “will probably overtake bitcoin at some point in the future, as Ethereum is superior in terms of innovation and developer interest,” said the co-founder of the blockchain software company Edge & Node, while also noting that investors will place money on both cryptocurrencies.
In general, the interest in virtual currencies has expanded beyond bitcoin, whose share in the capitalisation of the crypto market stands at $1.6 trillion, has dropped to 42% from about 70% in early 2021, according to data from CoinGecko.
In a report last week, Goldman commodity analysts wrote that Bitcoin’s advantage as a pioneer seems “fragile”, adding that there is a strong possibility that it will eventually lose its crown as the dominant digital currency.
The two analysts noted that Ether seems to be the most likely candidate to surpass Bitcoin, stressing that such a “possibility is anything but certain.” They noted that Ether’s annual supply increase has a cap, contributing to its credentials as a means of storing value.
The CEO of crypto stock company Oasis Pro Markets claims that Ether is beginning to be considered to have a “better growth narrative” in the long run.
The price of Bitcoin fell by about 37% in May, one of its biggest monthly declines, while Ether recorded losses of about 11%.
What Bitcoin fans support
For some, Bitcoin will beat its rivals and remain dominant, due to the huge attention it enjoys. For example, the CEO of Tokens.com claims to have “the best outside testimony” given the way institutions and famous people, such as Musk refer to it.
“Bitcoin will remain the king of cryptos,” said an Oanda Corp. analyst. “Bitcoin has a very big lead over Ether and has a big advantage, a defined offer of only 21 million coins.”