ERC-20 value overtakes ETH for the first time as bullish trend continues

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Last Updated on 19 July 2022 by CryptoTips.eu

Jeroen Kok

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As we explained you in May, the trend was deep and it seemed to be accelerating. This is why this changeover is not a surprise for anyone who has observed the Ethereum network for a few months. As the CoinMetrics (you will get a popup) data shows, the value of ERC-20 tokens now exceeds $29 billion, against $26 billion for ETH.

ERC-20 overtakes ETH

It is the first time that the value of ETH has been exceeded by ERC-20 tokens. What this means is that the savings created around the Ethereum network are now more important than the value of Ethers, which is the native token of the project.

It should also be noted that this comparison only takes into account the ERC-20 tokens, and not the ERC-721 standard, i.e. non-fungible tokens. That is to say that if we take into account all projects based on Ethereum, the gap with ETH is even greater.

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2020 is the year of DeFi

This paradigm shift is, of course, the direct consequence of the incredible ramp-up of DeFi in recent months. According to dAppRadar data, the three dApps with the highest transaction volume are linked to DeFi. In this particular category: Compound, Synthetix and MakerDAO lead the way and occupy the first 5 places in the ranking of DeFi market caps.

Growing demand for stablecoins, and Tether, in particular, has also enabled this change. On Ethereum, USDT currently represents a market cap of $9 billion, and it continues to attract interest from investors.

Ethereum consolidates its position

What this suggests is that the Ethereum network has managed to achieve one of its goals: it is now used as the basic architecture for launching successful crypto projects. 

However, it is important to see how the DeFi market will stabilize in the coming months, once the first wave of enthusiasm has subsided.

Despite the surge from ERC-20, Ethereum still has a gap from its competitors in the top 10 coin rankings. From January to June, it has increased by 75% when compared to its direct competition in the top 5 rankings and has gained on Bitcoin.