Flippening, the term has gained popularity in the cryptocurrency world as investors speculate that Ether (ETH) may overtake Bitcoin (BTC) as the dominant crypto. Is this likely to happen?
What is flipping?
the flipping is a term coined in 2017 and used in crypto to refer to a potential swing of the largest cryptocurrency (Bitcoin therefore) in terms of capitalization. This term refers specifically to the possibility that the Ether of the Ethereum blockchain will exceed the market capitalization of Bitcoin (BTC).
The market capitalization of a cryptocurrency is its circulating supply (number of coins) multiplied by its current price.
Although BTC has always been the first cryptocurrency in terms of market capitalization, its dominance in the market has dropped year by yeardropping from 95% in 2013 to less than 40% in 2022.
It was mid-2017 that Bitcoin lost strength and other cryptocurrencies managed to regain market share. One cryptocurrency in particular stands out, Ether from the Ethereum blockchain. The Ethereum community then hoped during this period that ETH would manage to overtake BTC in terms of capitalization, so that it would succeed in flipping.
On June 18, 2017, Bitcoin dominance hits one of its lowest points at 38.69% of the market. In parallel, the dominance of Ether over the entire cryptocurrency market explodes and exceeds 31.22%. This difference of only 7.5% will then never be found. Ether has never been so close to dethroning Bitcoin as the 1st crypto on the market.
The flippening almost happened on June 18, 2017
Flipping is still a goal for part of the crypto-community and many believe it is still possible for ETH to overtake BTC in days in terms of capitalization.
Since then, this term has replicated to other cryptos and is also used to refer to other potential swings, such as that of the most capitalized stablecoin. Thereby, another flippening observed for a few years is that of the stablecoin USDT by the USDCeternal second behind the stablecoin of Tether.
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Will flipping ever happen?
It is not possible to know when or if the flippening will occuras the capitalizations of Bitcoin and Ether are subject to a wide range of factors, in particular their adoption and the general conditions of the contract.
The correlation between the two cryptocurrencies will have to decrease so that Ether can one day hope to dethrone Bitcoin. Indeed, even today, if the price of Bitcoin starts to rise or fall, Ether will do the same.
Furthermore, part of the crypto-community believes that the greater utility of the Ethereum blockchain, especially with its smart contracts, will irretrievably lead Bitcoin to lose its first place.
However, Bitcoin draws its strength from the fact that it is the digital equivalent of gold. Bitcoin remains the most reliable store of value of all cryptocurrencies (apart from the specific case of stablecoins).
It is impossible to predict whether or not flipping will ever occur, but it will be important to monitor the evolution of the dominance of major cryptocurrencies on others as regulations are rolled out around the world.
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Editor-in-chief of Cryptoast, I discovered Bitcoin and blockchain technology in 2017. Since then, I have been striving to share quality content so that the sector becomes more democratic for everyone.
Clement Wardzala
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