Posted 1 year ago | by Ben Armstrong

Is Ethereum on the Cusp of Overtaking Bitcoin?

Over the past decade, when the cryptocurrency market diversified, different financial philosophies took place in the form of individual cryptocurrencies. Ethereum has become a challenger to Bitcoin.

Ethereum split from many of the ideals that made Bitcoin popular, and it has been very successful. Over the past few years, Ethereum, the world's largest alternative currency, has proven to be a popular platform for development, and it is at the heart of the Decentralized Finance (DeFi) movement.

Speaking on the POV podcast, Ethereum co-founder Vitalik Buterin pointed to issues related to Internet money, cryptocurrencies, and also Ethereum's most prominent use cases.

Ethereum is Growing into a Mature Platform

The term "Internet money," is reminiscent of the early days of cryptocurrency. For currencies like Bitcoin, its use cases have diversified ever since. Buterin figured out that for Ethereum, it would act as a base layer that other things can be supported by, on, and have applications that run on it.

Buterin answered questions about how cryptocurrencies have a wide range of functions or why they could be a store of value or a form of exchange. In this vein, he also mentioned the role of cryptocurrencies as collateral in applications.

Specifically, he mentioned the possibility that cryptocurrencies can be used as collateral for applications that could be centralized or decentralized. The bottom line is that if you have some assets, and can put them into some smart contract.

DeFi is Taking Root

In the DeFi space, which is partly comprised of services offering Ethereum-backed ETH loans, has been growing rapidly. In fact over the past month the DeFi ecosystem grew its total locked value from $ 650 million USD to $ 838 million USD.

Highlighting the global liquidity crisis and the role of cryptocurrencies like Bitcoin and Ethereum in it, Buterin also stated that liquidity in cryptocurrencies performs differently.

Buterin said:

"There's definitely a flight for liquidity in the sense that there's some kind of new audiences that ultimately have to choose whether they half of their money in one asset or another outset, or whether they move their money into one asset or another asset. And there's a competition for which assets that money moves into and gets stored inside."

According to many commentators, the March 12 price collapse was the result of a liquidity crisis. Cryptocurrencies could have been hit due to the interest from established institutions entering the cryptocurrency market and then selling into a panic.

The number of smart contracts on its network has increased exponentially since the price collapse in March. More than one million Ethereum smart contracts have been created since March 12. The number of smart contracts deployed on Ethereum then increased from 13.36 million on March 12 to 14.41 million on April 26.

ETH has been at the core of the rush to create new stablecoins, which is the crypto market's equivalent of a risk-free asset. Of course, this isn't a bullish development for the short term, but it may prove to be a great thing for cryptos in the long-run.

About Ben Armstrong

ef4f73e9ddeb61becab57469962fa946?s=90&d=blank&r=g Is Ethereum on the Cusp of Overtaking Bitcoin?Ben Armstrong is a YouTuber, podcaster, crypto enthusiast, & creator of BitBoyCrypto.com. Better known as BitBoy Crypto, he works hard to educate and inform the crypto community.

Ben has been involved with the world of cryptocurrency since 2012 when he first invested in Bitcoin. He used Charlie Shrem's BitInstant & lost Bitcoin in the Mt. Gox hack.

In 2018, Ben decided to go "full-time crypto" and focus all of his time and energy into expanding the reach of crypto.

If you have any questions or comments please feel free to email him at BitBoy@BitBoyCrypto.com or contact him on Twitter @BitBoy_Crypto.