Tom Lee, the chair of BitMine Immersion Technologies (BMNR) and a long-time Bitcoin advocate, says Ethereum could eventually flip Bitcoin’s market cap, much like how U.S. equities overtook gold following the collapse of the gold standard in 1971.
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“Ethereum could flip Bitcoin similar to how Wall Street and equities flipped gold post ‘71,” Lee told ARK Invest CEO Cathie Wood during a joint interview. While the idea of a flippening has been debated for years, Lee believes tokenization could finally bring that scenario into focus.
Currently, Bitcoin’s market cap stands at around $2.17 trillion, nearly five times larger than Ethereum’s $476.3 billion. However, Lee points to historical precedent to support his case.
Comparing Ethereum to the Rise of the Dollar
Lee referred to the Nixon Shock of 1971, when the U.S. officially untethered the dollar from gold, as a historical analogy. This move ultimately led to a boom in dollar-denominated financial products and cemented the dollar’s global dominance.
“When that happened, the immediate beneficiary was demand and a market to own gold,” said Lee. “But Wall Street created products that made the dollar dominant, and the market cap of equities today is $40 trillion compared to $2 trillion for gold.”
He argued that Ethereum could follow a similar path in a world where everything becomes tokenized. “Dollar dominance by the end of that period went from 27% in GDP terms to 57% of central bank reserves and 80% of financial transactions,” he added. “Dollar dominance is going to be the opportunity of Ethereum.”
Tokenization Is the Key to Ethereum’s Path Forward
Lee believes the path to Ethereum’s dominance lies in stablecoins, tokenized assets, and blockchain-based infrastructure. “So as we move dollars onto the blockchain, which is stablecoins, we’ll move stocks and real estate,” he said.
This shift could create exponential new demand for Ethereum as the backbone of a tokenized financial system. “Everything becoming…tokenized,” is what will give Ethereum its edge, Lee concluded.
Beyond Lee’s theory, industry insiders have increasingly pointed to Ethereum’s real-world utility as a long-term advantage over Bitcoin’s store-of-value narrative.
The Flippening Debate Is Back in the Picture
The idea that Ethereum will eventually overtake Bitcoin has been circulating in crypto circles for years. In August, Consensys founder Joseph Lubin said Ethereum could “surge by 100 times and flip Bitcoin as a monetary base.”
This statement echoed sentiments from DeVere Group CEO Nigel Green, who said back in 2021, “Ethereum is already years ahead of Bitcoin in everything but price and fame.”
However, not everyone agrees. Bitcoin maximalist and Jan3 founder Samson Mow recently pushed back, arguing Ethereum investors will “switch back to Bitcoin once ETH prices are high enough.”
Still, Lee’s comparison to one of the most transformative monetary events in U.S. history may give the flippening narrative new momentum.
Final Thoughts
Ethereum remains far behind Bitcoin in market cap, but narratives drive markets, and the idea of ETH overtaking BTC is gathering strength again. If tokenization truly becomes the next financial megatrend, Ethereum may be better positioned than ever to take the lead.
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