Ethereum is on a course that could see it become the first public blockchain to be valued over $1 trillion
About two months ago, Chris Burniske of PlaceHolder Capital proclaimed that Ethereum and Bitcoin were competing in terms of the first platform to hit a $1 trillion market cap in cryptocurrency. Now it looks like Ethereum will make it over the line first.
The Ethereum network is growing by the day, and according to past trends over the last few months, it can reach $1 trillion this year. It will be the first blockchain to achieve this milestone if it is successful.
The third quarter DeFi frenzy has been a major boost in this path as it significantly contributed to the ETH network settling more than double of the daily transaction volumes of BTC. Cryptocurrency market data platform Messari shows that the 30-day rolling daily average for BTC transaction volume is less than $3 billion, whereas ETH is processing $7 billion.
The last time Ethereum had a strong calendar year compared to Bitcoin’s was in 2018. In that year, Ethereum settled $500 million in transaction volume, whereas Bitcoin processed $849 million in the same period.
Bitcoin is projected to settle $800 million this year. If it achieves this milestone, then 2020 will be its second-strongest year yet, after 2018.
The comparison between Ethereum and Bitcoin is, however, an indirect one. This is because of the underlying factor that plays a hand in ETH’s volume. Bitcoin mostly represents transactions of value denominated by BTC. Ethereum, on the other hand, settles the volume of the DeFi sector, since a significant chunk of DeFi activity occurs on top of Ethereum-based smart contracts.
Messari also predicts that the next 12 months will play a major role in defining platform wars in the crypto space. This will likely be the case as Ethereum’s current costly fees are a stumbling block that competing blockchain platforms will be aiming to solve. Messari further notes that the emergence of parallel DeFi ecosystems will be a crucial factor that will determine the outcome.