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Ethereum set to become first blockchain to settle $1 trillion in one year
According to crypto market data aggregator Messari, the 30-day rolling daily average for Ethereum transaction volume is currently $7 billion, with Bitcoin processing less than $3 billion.
If the current trend continues, Messari predicts Ethereum will become the first public blockchain to settle $1 trillion in transfers over a calendar year.
Ethereum’s previous strongest calendar year relative to Bitcoin was 2018, when it processed half a billion in volume, which was 59% as much as Bitcoin’s $849 million that year.
Bitcoin is on-pace for its second-strongest year behind 2018, projected to process $800 million.
It’s not a straightforward comparison between the two blockchains however. With the DeFi bubble largely taking place on top of Ethereum-powered smart contracts, the Ethereum network now processes the volume of an entire sector, while Bitcoin largely represents transfers of value denominated in BTC.
Messari’s Ryan Watkins attributes much of Ethereum’s volume spike to increased ERC-20 stablecoin volumes, with the majority of Tether (USDT) transactions now taking place on Ethereum and yield farming-driven demand pushing supply growth of more than 600% for MakerDAO’s DAI stablecoin.
Watkins also notes booming on-chain liquidity from decentralized exchanges (DEXs), with Uniswap and Curve generating more than $20 billion in volume combined during September. DEXs now represent more than 13.6% of total exchange volumes.
However, Messari predicts “the next twelve months could come to define the platform wars” in crypto, noting Ethereum’s ongoing high fees as a problem that rival blockchains will seek to solve, alongside “the rise of parallel DeFi ecosystems.”
“Look for all would-be ETH Killers to continue to empty out their treasuries to build a parallel DeFi sector throughout the end of 2020 and beyond.”
In August, Chris Burniske, a partner at PlaceHolder Capital, asserted that Ethereum and Bitcoin are racing each other to reach the first $1 trillion market cap in crypto.
Author: Cointelegraph By Samuel Haig
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