Stablecoin use lets Ethereum surpass Bitcoin in daily settlements
- Ethereum recently surpassed BTC in daily settlement value.
- Bitcoin dominated for a long time when it comes to this metric, but the Ethereum network finally prevailed.
- Combined usage of ETH, DeFi, stablecoins, and all Ethereum-based tokens allowed the project to take the lead.
Bitcoin has been the dominant crypto project when it comes to the daily settlement value for a long time, but recently, it got dethroned by Ethereum (ETH). New research shows that the second-largest crypto project by market cap exceeded Bitcoin after seeing a massive surge of economic activity.
However, while this is true for Ethereum as a project, it did not happen due to ETH itself. Instead, the Ethereum network saw an increase in the activity of stablecoins, which is where all the extra activity comes from.
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.
The new data comes from a Messari researcher, Ryan Watkins. Watkins posted the findings for the past quarter, as well, which is when he noted that ETH was almost the same as BTC in terms of daily settlement value. The second quarter of this year, however, allowed the project to blow past Bitcoin, and become the new dominant project.
Watkins also noted that the trend is unlikely to reverse anytime soon, meaning that BTC will likely remain in the second spot by this metric for the time being.
Bitcoin settlement value was difficult to beat
Despite all of its network’s activity, Ethereum never managed to exceed BTC in the settlement value alone in the past. This is its first time to take the lead, which is really another proof of just how much BTC is being used around the world.
After all, Ethereum includes more than just Ether. The combination of all ERC-20 and other tokens was not enough to exceed BTC’s settlement value for all the years of the two projects’ co-existence.
As for what allowed Ethereum to finally prevail, a lot of it has to do with the DeFi liquidity mining, which has gone into quite a craze over the past few months. It gave Ethereum the momentum it needed to take the lead, as DeFi total value locked recently hit an all-time high, climbing over $3 billion.
Alongside Tether and Dai, it is easy to see why Ethereum managed to overtake BTC, even if it did take so much time to do it.