Ethereum Now Matches Bitcoin on One Key Metric

The use of the Ethereum network to move value around has shot to record levels, thanks to the growth of stablecoins.

AccessTimeIconApr 16, 2020 at 9:00 a.m. UTC
Updated Sep 14, 2021 at 8:29 a.m. UTC
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The use of the Ethereum network to move value around has shot to record levels.

A Wednesday tweet from Ryan Watkins, research analyst at Messari, revealed data showing the total value transferred on the Ethereum network, including ether and ERC-20 stablecoins, now matches that of the Bitcoin network.

The numbers show "Ethereum is becoming the dominant value transfer layer in crypto," he said.

Credit: Messari
Credit: Messari

Value transfer refers to the U.S. dollar value of the total units on a blockchain that are transferred on a given day. With Bitcoin, the metric refers to the USD value of all the bitcoin sent on a given day.

Value transfer on Ethereum differs slightly. As well as its own ether cryptocurrency, Ethereum supports assets from third parties that can be sent and received over its network. For the above chart, value transfer on Ethereum refers to the USD value of both ETH and the Ethereum-based stablecoins that are transferred on on a given day.

Another chart from Messari show just how much the increase in the amount of value moved via USDT has boosted Ethereum's numbers over the last few months.


Data dispute

Citing concerns about the validity of Watkins' findings, independent developer Udi Wertheimer expressed his thoughts regarding the exclusion of Omni data, a software layer on the Bitcoin network that includes the issuance of the world's most used stablecoin, tether (USDT). The Ethereum chart had included data for USDT issued as an ERC-20 token.

"USDT on Omni is bigger than all the non-USDT Ethereum-based stablecoins. If you include USDC and the smaller ones, you should also include Omni-USDT," Wertheimer said.

But Watkins was quick to answer, arguing the conclusion remained the same.

"USDT transferred over Omni has dropped substantially as USDT has migrated over to Ethereum," Watkins told CoinDesk.

"Furthermore, the amount of value transferred on Ethereum is slightly underestimated because it only includes the top stablecoins that CoinMetrics provides data for, and not all Ethereum-based tokens," he said.

According to its "transparency" page, Tether said it has up to almost $4.9 billion USDT on Ethereum, while it has up to $1.55 billion on Omni.

New record

In his tweet thread, Watkins also noted stablecoins have just had their best quarter to date. Issuance in the first quarter of this year, he said, had "ballooned over $8 billion," adding almost as much to the category's market capitalization in Q1 as for all of 2019.

"Over the past two years, many stablecoin issuers have created stablecoins on Ethereum because of its flexible token standards that allow for the easy issuance and interoperability," according to Watkins.

"These stablecoins have grown so great in amount that they're now being widely used as money on the Ethereum blockchain. Instead of sending and receiving value in ETH, which is volatile, users can send value in stablecoins which are price-stable with the U.S. dollar," the researcher said.


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