"The Flippening" is a term being dropped into cryptocurrency conversation more and more in recent weeks. While Bitcoin has dominated the conversation, as well as the wider efforts of all digital currencies to achieve a greater degree of recognition in the larger financial world, Ethereum seems to be making quick gains on its more established rival. Despite Bitcoin's nearly tripling in price since the beginning of 2017, the iconic cryptocurrency has also seen its share of the total industry market cap drop from 87% to 39% in the past four months. Ethereum, on the market for just two years compared with Bitcoin's decade, has undergone an inverse effect: its share of market cap has risen from 5% back in February of this year to about 31% as of mid-June.
Basics of "The Flippening"
"The Flippening" refers to a point in time at which Ethereum (or, potentially, some other cryptocurrency) switches places with Bitcoin, taking on the largest position in the cryptocurrency world in terms of market cap. So far, this has yet to take place, in spite of the efforts of many fledgling digital currencies to overtake Bitcoin with new technology, partnerships with corporations, and innovative marketing efforts. And yet, some analysts see the latest wave of growth in Ethereum as the most likely contender to topple Bitcoin's reign at the top.
For most of Bitcoin's history, a potential Flippening was a highly remote possibility. Even at the beginning of 2017 such a prospect seemed unlikely. Part of what has given Ethereum a chance to overtake Bitcoin has been its rise in value over the past few months. The currency is currently hovering just below $400 and has reached highs over that level.
What would the Flippening mean for the cryptocurrency world? Some suggest that once Bitcoin is toppled it may never reach the top of the pile again, as newer and more improved cryptocurrency systems continue to emerge. Bitcoin could continue on without being the center of attention, or it could gradually fade away. Further, Bitcoin could see its system completely disintegrate as a result of scaling problems or other significant growing pains. In any of these cases, the rise of Ethereum could see the broader acceptance of the Ethereum blockchain system across the digital currency field.
Other analysts are skeptical of the Flippening. According to CryptoCoinsNews, Gyft co-founder Vinny Lingham took to Twitter to express his view that "Bitcoin is better money, deflationary & scarce. Ether is not really money, inflationary & abundant. The Flippening makes no sense." In Lingham's opinion, Bitcoin and Ethereum are actually not competitors. Bitcoin has been built to function as a currency with a limited supply, while ether is designed to power Ethereum's smart contracts platform as a token, not a currency.