Bitcoin Is Money; Ether Is Not

Paulo Ardoino, Chief Technology Officer at Bitfinex and Tether says Ether cannot compare to Bitcoin as money:

Bitcoin is Money; Ether is Not
As the CTO told Crowfund Insider on Tuesday, Ethereum is “stuck between claims of being a form of money and claims of being a platform.”

As formulated in its whitepaper, Ethereum was designed as an “alternative protocol for building decentralized applications” that Bitcoin wasn’t well suited to support. From smart contracts to stablecoins, to non-fungible tokens (NFTs), every ecosystem transaction is powered by Ether – the now second largest cryptocurrency.

More recently, some have also taken to calling Ether “ultrasound money” due to how its tokenomic structure will look after the merge. Its transaction burn mechanism coupled with a substantial decrease in ETH per block will effectively make it a net-deflationary currency.This could theoretically put it in competition with Bitcoin – a cryptocurrency well-renowned as long-term inflation hedge due to its fixed supply. However, Ardoino thinks there’s more to the story:

“ETH cannot compete with Bitcoin on the money front because there is no fixed supply, and it isn’t really a world computer yet because it has a shared global state and hence too slow to be scalable,” he explained.

The CTO added that the Merge will not fix Ethereum’s relatively high transaction fees (something Ethereum developers have confirmed), nor will it make Ethereum any more decentralized.

Master Asked on September 14, 2022 in Cryptocurrency.
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