UBS with the note:
Perhaps the biggest debate in crypto concerns if and when ether might wrest bitcoin’s crown. BTC has a market cap that is more than twice as big and still boasts around two thirds more active addresses. But ETH is starting to nose ahead on metrics like traded volumes and trade intensity, to say nothing of transaction counts and overall fees where it totally dominates (Figures 1-3). This matters because the so-called ‘flippening’ reflects network effects that drive prices(Figure 4). But it’s also significant as these two coins embody competing visions for the intrinsic value of cryptocurrencies.
Most digital assets can be located on a spectrum that BTC and ETH basically define. Bitcoin’s proponents play up its scarcity, security and fixedness, suggesting it can be thought of almost exclusively as a long-term store of wealth which they are adamant will appreciate. Ether’s celebrate its blockchain’s versatility as a platform for disruptive innovation, claiming it can reorder a huge swathe of our economic and social interactions. Nevertheless, distinctions are less clear-cut in practice and neither is predestined to champion its archetype. Bitcoin’s code appears objectively superior but still requires periodic upgrades, such as the pending Taproot soft fork to provide privacy enhancements and support more complex transactions. Its Lightening Network is a Layer Two solution that is still struggling to facilitate smaller transactions. It also faces direct competition from some of its own past spin-offs such as Bitcoin Cash and BSV, which scale easily by grouping transactions into bigger blocks. And small quantities already trade in ‘wrapped’ in ERC20 format on Ethereum’s blockchain.
