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While on the verge of losing its number one position, Bitcoin regains 27 percent of market dominance.
Last month in the cryptosphere, a new buzzword surfaced to describe the recent dominance movements: the “Flippening.” This is the instance where Ethereum would overtake Bitcoin’s market cap, and become the number one cryptocurrency.
Bitcoin started the year with an 87 percent dominance, which then steadily declined while Ethereum made a spectacular surge of over 4,000 percent in the same period. Bitcoin’s dominance then reached 37 percent on June 20, putting the cryptocurrency on the verge of losing its champion position.
The big hype that accompanied Ethereum gaining steam is now calming down, as the convergent trend of the market caps of BTC and ETH became a divergent one. The Flippening might still happen, but the trend is now towards the “Floppening” - a joke term that describes the near miss of Ethereum, which is now struggling to remain over the $200 bar.
The extreme volatility of the crypto-market shows once more that even major currencies like Ethereum can lose half of their cap in mere days. While Bitcoin dropped significantly as well, it nonetheless better resisted to the recent crypto-massacre. Its market cap decreased from $46 bln to $38 bln, and even though its dominance is far from its position in early 2017, its premium status is still conserved.
The massive and record-breaking ICOs of June/July have revealed serious weaknesses in the Ethereum network, causing many to question how much “better” it really is than Bitcoin.
During its token sale, the strong hype around Bancor led to a significant increase in pending transactions, as buyers attempted to acquire BNTs. Consequently, the whole Ethereum network was impacted for many hours from such a rush.
Pending transactions end up in a dedicated memory space on the network’s nodes, which is more commonly called “backlog.” When this space is saturated, transactions take greater amounts of time to be validated that can go up to hours, as the Bancor case showed.
Regarding congestion, however, it is the Status token sale that created the most on Ethereum. The ICO registered the highest ever number of daily transactions on the network: 308,488.
As a result, the Ethereum network got clogged up and started slowing down significantly. This network paralysis was so strong that many exchange platforms temporarily blocked ETH withdrawals. MyEtherWallet, one of the most popular ETH wallets, even displayed a note discouraging users to send ETH if their transaction was not urgent.
These recent network congestions reveal that Ethereum is suffering from currency-specific challenges, which put hopes for the Flippening at bay. The BTC/ETH currency pair has now moved in favor of Bitcoin, but the future remains uncertain as we move towards major upgrades for both cryptocurrencies.
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