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Analysis

Ethereum flipping Bitcoin – Here’s the full picture

Ethereum has considerably reduced the gap to Bitcoin. While comparing their market caps would not bequeath such sentiment (BTC’s $680 billion to ETH’s $292 billion), in terms of exposure, fundamental developments, and overall market intrinsic value, Ethereum is right in the mix and no longer under its shade. Its rapid growth keeps bringing up the…

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Ethereum flipping Bitcoin – Here’s the full picture

Ethereum has considerably reduced the gap to Bitcoin. While comparing their market caps would not bequeath such sentiment (BTC’s $680 billion to ETH’s $292 billion), in terms of exposure, fundamental developments, and overall market intrinsic value, Ethereum is right in the mix and no longer under its shade.

Its rapid growth keeps bringing up the probable eventuality of Ether overturning BTC’s market cap in a few years. Earlier, the arguments were more theoretical, but with time, facts have begun to support ETH’s argument, or rather ‘Ethereans’ argument.”

What are these Ethereum flag-bearing facts?

These facts can be classified down to three key aspects,

i) Economic Value Settled


ii) Fees paid for network utilization


iii) Settlement Assurance

Source: Money Movers

i) Since mid-2020, there has been no doubt that the economic value settled on Ethereum has reached a new level. Data suggested Ethereum facilitated 5 times more financial activity than BTC, with the same suggesting that users are willing to trust the network in securing their monetary value.

Here, it is important to note that the financial activity settled on ETH ranges from different DeFi products to other financial assets. However, Ethereum-dominated value also outperformed BTC as ETH still settles about $20 billion every day in comparison to BTC’s $14 billion.

ii) Now, users have recently raised their voice against ETH’s incapability to facilitate cheaper transactions. DeFi has completely blown up the space and market congestion has led to the highest average settlement fees. Yet, people haven’t moved away from it.

The 7-day average fees paid to miners stood at $32 million/day for ETH, at press time, to BTC’s $4 million/day. Ethereum’s block space is more valuable than any other blockchain’s because it facilitates so much more, while BTC’s chain remains anti-interoperable.

iii) When it comes to security, Bitcoin is still the supreme leader. But, for a brief moment, its throne was challenged. Data from howmanyconfs.com recently suggested that Ethereum was momentarily more secure than Bitcoin. While press time data would indicate BTC’s dominion, the narrative did flip for a while.

Now, ledger costliness is an efficient metric to understand settlement assurances. The higher miners are paid, the less risky it is for the network to get attacked.

Further, data from bitinfocharts indicate that Ethereum is processing payments roughly ~18 billion per year to miners at press time, while BTC’s daily tx fees and payouts added up to $13.55 billion per year. Ergo technically, Ethereum is paying more to its miner and has a higher ledger cost, meaning, it is more secure theoretically.

And yet, the flip should/would not happen

While facts and numbers do not lie, they do not convey the power or pull of market sentiment. Bitcoin is at the top of the heap not only because it was the first crypto-asset, but it has never been altered in any form, and the monetary policy has stuck out through bulls and bear markets.

With Bitcoin, there is a form of familiarity. Yes, it may not be the most efficient medium of transaction anymore, but more and more people are understanding and evaluating its long-term intrinsic value. Bitcoin is almost the complete project.

Ethereum continues to remain a puzzle, one which may or may not turn out to be a masterpiece. Its protocol keeps on changing, and while changes have made the network better, it might take a long time for people to actually grasp the innate value of the ETH blockchain.

Additionally, Bitcoin represents the last of PoW projects. After Ethereum’s migration to PoS, it enters a pool of tokens that are competing in the same protocol. We are talking about Cardano, Polkadot, Solana, etc. all being polarized as “Ethereum killers” and the competition is stiff. A non-tech person would be able to comprehend the value of Bitcoin, but Ether remains as complex as ever.

Ethereum is currently the jack-of-all-trades asset to Bitcoin’s Ace. The ace will always win irrespective of when you play your joker. It is imperative that Bitcoin-Ethereum continue to share the same form of reality. Anything other than that establishes another route to uncertainty, one where Bitcoin getting flipped might fuel more chaos than calm. That will not serve Ethereum’s purpose either.


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Analysis

SEC, Ripple, XRP Lawsuit update: This is ‘something obviously the SEC does NOT want to see happen’

The ongoing case between the United States SEC and Ripple Labs was already seeing a lot of back and forth before John Deaton and XRP Holders filed a motion to intervene. While the defendants, for their part, have come out in support of the movants’ motion in “limited capacity,” the regulatory agency has vigorously argued…

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SEC, Ripple, XRP Lawsuit update: This is ‘something obviously the SEC does NOT want to see happen’

The ongoing case between the United States SEC and Ripple Labs was already seeing a lot of back and forth before John Deaton and XRP Holders filed a motion to intervene. While the defendants, for their part, have come out in support of the movants’ motion in “limited capacity,” the regulatory agency has vigorously argued against both the motion and Ripple’s “limited participation” idea.

The SEC’s latest response to both has fueled quite a reaction within the crypto-community, with most on the fence with respect to what they expect might happen next. Jeremy Hogan, however, isn’t one of them, with the popular attorney recently going on Twitter to air his views on the agency’s response to XRP holders’ motion to intervene.

According to Hogan, the aforementioned response “jumped the proverbial shark,” with the attorney implying that the SEC’s latest argument is unlikely to fly and be accepted by the court in the present case. Here, the argument that Hogan was referring to was the allegation that Ripple and Deaton and XRP holders are in cahoots with each other and are colluding to beat the SEC.

Such an allegation is an extension of similar statements made by the SEC in the past. In fact, in its initial reply to Deaton’s motion to intervene, the agency had accused the movants of “reciting” the defendants’ litigation position. Even in its present response, the SEC has alleged that the movants won’t be impartial and objective participants, with the agency adding,

“….. Movants would act as friends of the defendants, not true friends of the court.”

It’s worth adding, however, that for his part, Hogan seemed to agree with the SEC’s contention that XRP holders shouldn’t be “injected as full litigants.” Instead, he said,

“I think the Judge should (and will) grant limited “amici” participation – something obviously the SEC does NOT want to see happen.”

Hogan, ergo, seemed to side with Ripple’s conditions for XRP Holders’ participation in the present case.

The popular attorney also took issue with the fact that the SEC has failed to recognize the value of the new insights and facts the movants might be able to bring to the said litigation.

What does the SEC’s latest response, the sheer tone and animosity of it, mean for the prospect of settlement, however? Well, according to the attorney, “it doesn’t change anything.”

Finally, Hogan observed,

“Lawyers are not supposed to make baseless accusations against opposing counsel yet, here we are…”

This is a telling statement to make, especially since something similar was implied by the intervenors’ latest memorandum of law against the SEC’s opposition. In his submission to the court, Deaton had claimed that he was being “unfairly targeted as an unhinged conspiracy theorist crusader.”


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Jibin George

Jibin is a news editor at AMBCrypto. With over three years of experience as a political writer, he primarily focuses on the political impact of crypto developments. A graduate in Law and International Relations, his writing is by and large focused on cryptocurrencies from the political and financial perspective. A Liverpool FC fan. YNWA

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Analysis

Matic & Loopring: Why these projects matter to Ethereum’s performance

With ETH’s price back in the $2900 range, there has been a lot of debate on the level of security Layer 2s provide, their long-term ROI, and the sustainability of their price rally. After crossing the $4000 level on May 12, the price dropped, several times and the scaling solutions’ have rallied. Consider the analogy,…

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Matic & Loopring: Why these projects matter to Ethereum’s performance

With ETH’s price back in the $2900 range, there has been a lot of debate on the level of security Layer 2s provide, their long-term ROI, and the sustainability of their price rally. After crossing the $4000 level on May 12, the price dropped, several times and the scaling solutions’ have rallied.

Consider the analogy, someone with $100 can save or store it in several ways as they would like. There is the option of storing it in a wallet, keeping it in a bank, or in the security of a vault. However, with Ethereum, a trader with $100 worth of ETH would have to use all ways at once – store in a wallet, bank and vault at once. Does that make it inefficient and unnecessary?

What L2 solutions do is that they offer the option of one way instead of many, making it efficient. These L2 solutions are projects like MATIC, Loopring, OMG. All three projects have offered high short-term ROI since the launch of ETH L2. In the case of MATIC, the number of transactions and the transaction volume have increased significantly since the launch.

The altcoin now ranks 14 in the top 25. The transaction volume for nearly all three projects has increased, on account of significantly high fees of settling transactions on the ETH network. According to data scientist @ASvanevik, MATIC has the largest inflow of stablecoins of any Ethereum address in the last 7 days. This signals increasing demand for MATIC, while the price rally extends beyond the 105% from last week.

In the case of Loopring based on the following data from Lunarcrush.com, the Galaxy Score Trend, a combined measure of health, quality and performance, is at 63, lower than the peak it hit the second week of May 2021. The social volume has dropped considerably and the demand across exchanges has dropped. It is anticipated that once the social volume recovers and trader sentiment is neutral, Loopring would offer high short-term ROI like other L2 scaling solutions.

L2 solutions are likely to remain relevant for a long time; as ETH transaction fees remain high, traders and ETH Maxis have been bullish about MATIC and Loopring. MATIC already offers side chains and plasma and has a roadmap to introduce optimistic and Zk rollups in the future which is likely to increase ease of use. In the war of L2 scaling solutions, ease of use is the key factor, after demand and ROI. Long-term ROI is anticipated to be high for ETH and scaling solutions alongside it.


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Ekta Mourya

Ekta is a full-time journalist at AMBCrypto and her specialization lies in spot markets. Currently pursuing her MBA, she is passionate about trading, fintech, and everything decentralized.

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Analysis

What’s next for XRP’s price following these court proceedings

The ongoing legal battle between the SEC and Ripple has been somewhat of a rollercoaster for XRP traders and HODLers. There is uncertainty in the price of the altcoin, as a result of this legal debacle. The SEC has argued from the beginning of this enforcement action that XRP is a security. The impact of…

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What’s next for XRP’s price following these court proceedings

The ongoing legal battle between the SEC and Ripple has been somewhat of a rollercoaster for XRP traders and HODLers. There is uncertainty in the price of the altcoin, as a result of this legal debacle. The SEC has argued from the beginning of this enforcement action that XRP is a security.

The impact of the recent updates is that XRP’s price is at $1.44, down nearly 5% in the last 24 hours. There has been an increase of nearly 50% in the trade volume in the last 24 hours. The altcoin’s price is nearly 62% below the ATH of the $3.84 level based on data coinmarketcap.com.

The social volume hit a peak several times, following updates from the SEC vs Ripple hearing. It has dropped to 16258 based on the above chart, following SEC’s argument that XRP holders are actually XRP investors. This is akin to an attack on XRP HODLers’ portfolio given the impact on the ROI in the short-term. (Ironically, the SEC’s motto is to “protect investors”)

HODLers vs Investors: What is the fate of XRP traders

XRP Short term ROI || Source: Messari

Based on the above chart, XRP traders have earned less than 15% ROI in the past 30 days and that makes it less profitable than most altcoins in top 10. Similarly, for HODLers who accumulated when the price was at $1.9 level, they are currently unprofitable. The volatility has nearly dropped, with a few spikes following updates from the hearing. At the same time, XRP’s correlation with BTC and ETH is above 80%. This has helped the altcoin’s price sustain at the $1.6 level against the selling pressure on spot exchanges.

In its latest filing, the response from SEC makes the hostile stance towards XRP traders clear. The updates in court proceedings have by no means safeguarded the interests of XRP traders. The short-term ROI is expected to drop further following updates.

The enforcement action brought by the SEC may have never been intended to protect or negatively impact XRP’s price, however, at a time when nearly every mid to small-capitalization altcoin is rallying this summer, XRP’s rangebound price action is largely a result of the SEC proceedings against Ripple.

XRP traders have responded to this action, by consistent demand across spot exchanges and the market capitalization is currently above $51 Billion, the altcoin ranks 7 and there are currently no signs of dropping below the top 10.


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Ekta Mourya

Ekta is a full-time journalist at AMBCrypto and her specialization lies in spot markets. Currently pursuing her MBA, she is passionate about trading, fintech, and everything decentralized.

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