Home Articles What is the Meaning of Flipping and Does it Work?

What is the Meaning of Flipping and Does it Work?

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As the market cap of Bitcoin sees a decline, rumblings of flipping also begin to surface. Among other cryptocurrencies, Bitcoin is the currency that was the first to market. Flipping is a theoretical situation where Ethereum’s market cap supposedly overtakes that of Bitcoin, bringing about it turning into the prevailing digital money.

Let’s get into what flipping means. If you are interested in bitcoin trading visit bitcoin-360-ai.co

What Is Flipping?

Flipping is a term commonly used to describe a potential “flip” in most major cryptocurrencies. While specifically, it refers to the possibility of being overtaken by the largest cryptos, Ethereum and Bitcoin. Looking to flip, the cost of Ethereum is lower than the price of Bitcoin. On the other hand, if we talk about the calculation of the market cap, then it is done by multiplying its value by the total amount of the particular crypto in circulation.

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How Does Flipping Work?

In the crypto world, market capitalization alludes to the all-out worth of a given digital currency. In theory, it’s calculated the same way market capitalization is calculated for a company: multiplying the total outstanding shares by the price per share. And essentially, the concept is supposed to be the same for crypto: multiplying the price per coin by the number of coins in circulation. Given such dynamics, sudden bullish price movements of Ether concerning BTC are known as flipping. Or, it could be that Ethereum price continues to outperform Bitcoin over time, resulting in volatility.

On the other hand, if we talk about the second component of this equation, then there are total coins in this circulation. While every crypto is correlated with the coin’s price, flipping can also occur due to the exponentially increasing supply of Ether in the case of BTC.

However, Ethereum has no limit on the total supply of Ether it can create. Seen over time, the reduced supply could also help to increase the value of Ethereum. In contrast, the total supply of BTC is around 21 million coins, which may be reached by 2040. And till date, about 19.1 million BTC has been mined. Given this situation, it is possible that the total value of BTC could gradually increase over the next few decades, barring potential volatility.

Will there be flipping?

When it comes to flipping, experts are divided, with some arguing that such a possibility will never happen, while others argue that it is only a matter of time. Both these camps base their claims on largely different factors. For example, generally speaking, one of the reasons cited by those people is that they don’t think that BTC’s market cap dominance will ever be overtaken by any other crypto, a spot bitcoin ETF. in the form of imminent acceptance, which they believe is institutional there is a direct way for investors to invest.

Contrary to most people’s thought process, Ethereum will supplant Bitcoin, the enormous ecosystem of crypto with a large number of non-fungible tokens (NFTs) and a large number of decentralized applications (dApps). What follows is the Ether merge, which will completely convert the ETH blockchain from PoW to PoS.

So, in the end, could we see “flipping” flourishing? So, the answer is yes. But it is not that it can last very long. However, since many of these initiatives are still in their infancy, it will probably take some time before society as a whole realizes the true worth of the underlying technologies.

For now, though, efforts to persuade retailers from various forms of social sentiment are still on, and large institutions may continue to wait for an entry point.