Bitcoin has been the clear leader in the crypto space since its introduction in 2009. Its market capitalization clearly dwarfs that of all other crypto assets.

Market data shows that Bitcoin has a market capitalization of $ 334 billion, while Ethereum is closer to $ 62 billion.

But a leading Wall Street veteran working in the field believes this could change in the years to come. He says Ethereum actually has the potential to surpass BTC’s market cap in the coming decade.

Here you can read how he came up with it.

Is Ethereum overturning Bitcoin?

Since Ethereum came within a few dozen percent of BTC’s market capitalization in 2017, the term “flippening” has become popular in the industry. This means that one coin overtakes the other and outperforms the other in terms of market capitalization.

Some Ethereum proponents believe that the cryptocurrency will eventually outperform BTC’s market cap. The idea is that because BTC has a single use case, namely being a store of wealth and a medium of exchange, Ethereum’s multi-faceted nature should bring it more acceptance over time.

Real Vision CEO Raoul Pal and a Wall Street veteran recently got behind this idea.

In an in-depth Twitter thread , he emphasizes how there are trillions and even quadrillion dollars of financial applications that can be built on top of cryptocurrencies.

Where Bitcoin will take the lead as collateral, Pal thinks Ethereum will be the layer on which transactions are processed, debts are issued, assets are tokenized, and so on and so forth:

“My guess is that BTC is a perfect layer of security, but ETH could have a larger market cap in 10 years for the reasons given above. Money and collateral are just the base layer. Everything builds on it. The store of value is security, the layer of trust and the exchange of values ​​is greater. “

To translate this into real life terms: There is an estimated M2 amount of money worth $ 19 trillion in the US today. While this sounds like a lot, there are currently trillions of dollars worth of derivatives built on this capital base.

Pal seems to imply that BTC will conquer the monetary base component of finance, while ETH could take over the derivatives and settlement level.

He’s not the only one who thinks that way

Placeholder partner Chris Burniske has indicated that this transition could happen sooner than perhaps most are aware.

The analyst comments that BTC and ETH are likely to “race” each other to a trillion dollar valuation in the coming years.

He believes Ethereum’s burgeoning DeFi economy will give him the fuel to gain relative worth versus BTC:

“In the meantime, $ ETH will be the new kid on the block for the mainstream – expect a high that comes with that realization. Given the lifetime outperformance of $ ETH versus $ BTC (see chart below), not to mention the lower network value and strong on-chain economy, I see all the reasons that $ ETHBTC will outperform ATHs. “