The #Flippening finally occurred this morning.
Ripple, a cryptocurrency that has soared by more than 540 percent in value in the last two weeks, overtook ethereum this morning to become the world’s second-most valuable cryptocurrency. Ripple’s payment network is being tested by consortiums in Japan and South Korea to reduce costs and time required for transferring money between the two countries.
The term 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. (See also: The #Flippening: Will Ethereum Take Bitcoin's Place.)
At 11:04 UTC this morning, Ripple had a valuation of $73.6 billion and was trading at $1.90 per pop. Those figures were sufficient for it to overtake ethereum, which was valued at $70.5 billion. But Ripple’s reign lasted only a short while. At 14:55 UTC, it was worth $71.6 billion as compared to Ethereum’s $73.1 billion market cap. (See also: Ripple Overtook Bitcoin Cash To Become Third Largest Cryptocurrency.)
In the meanwhile, bitcoin’s price has mostly moved within the $14,000 range in the last 24 hours. At 14:59 UTC, the price of a single bitcoin was $14,485.88, almost unchanged from 24 hours ago.
Prices for the top 10 most-traded cryptocurrencies were a mixed bag. Seven moved upwards. Ripple and Cardano, another cryptocurrency which has racked up substantial gains in the last two weeks, were the biggest movers and had increases of 31.3% and 22.8%, respectively. Bitcoin Cash was subsumed under the Ripple landslide. The bitcoin rival was down 5% from its price 24 hours ago and had a valuation of $42.4 billion.
A Remarkable Year
Less than two weeks ago, bitcoin was flirting with a price target of $20,000. But that figure seems like a pipe dream for the cryptocurrency’s enthusiasts, given the recent slump in its prices. (See also: Bitcoin's Price Crosses $19 K: How Soon Before $20,000?)
Still, this has a been an eventful year for the prices of bitcoin and cryptocurrencies in general. Their price gains made news and helped gain mainstream traction. Awareness and users grew as they raced past new records.
The constituency pontificating (and investing) in cryptocurrencies comprised a diverse set, from technology experts to JPMorgan Chase Co. (JPM) CEO Jamie Dimon and legendary investor Warren Buffett to Japanese housewives. Even Paul Krugman’s barber and Paris Hilton chimed in.
The chatter attracted institutional investors and forced CME and CBOE, two exchange powerhouses, to introduce bitcoin futures. (See also: CME To Launch Bitcoin Futures). By the end of 2017, Japan had legalized cryptocurrency tenders and Switzerland had reinvented itself as a destination for cryptocurrency startups.
But skeptics point to bitcoin’s underlying fundamentals as proof that the run-up in its price is a bubble. “At some point, it will completely collapse,” said Rupert Watson, head of asset allocation at Mercer, a wealth and investment management firm. According to him, bitcoin has not proved itself either as a currency or as a store of value. He cited gold’s history and longevity as proof that it would be around in case of a war or other financial mishaps. But it was “not likely” that that would be the case with bitcoin, Watson said.
Investing in cryptocurrencies and other Initial Coin Offerings (“ICOs”) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or other ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns 0.001 bitcoin.