Tom Lee says Ethereum can overtake – “flip” – Bitcoin by making a play for the dollar’s dominance in a world of tokenized assets, even as he remains emphatically optimistic about Bitcoin’s monetary role and long-term price.
In a podcast exchange with Cathie Wood, Lee framed the coming competition through a 1971-style lens, arguing that the end of the gold standard brought about a wave of financial engineering that ultimately made dollar-based stocks far bigger than gold; According to him, the broad tokenization of money and assets will square with that history, positioning Ethereum’s smart contract rails to capture the lion’s share of the activity.
Will Ethereum Flip Bitcoin?
Wood set the premise with ARK’s top-down vision of the addressable market for crypto by the end of the decade. “You know, the ecosystem that we expect to reach $25 trillion by 2030, the vast majority of which will be in Bitcoin,” she said, citing Bitcoin’s role as “a global monetary system, you know, based on rules that we’ve been missing since the US went off the gold exchange standard in 1971.” She asked Lee directly: “I would like to hear your thoughts on why ETH or the ecosystem will surpass Bitcoin.”
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Lee’s response was to rewind to that same inflection point. “In 1971, Nixon formally withdrew the U.S. from the gold standard. The immediate benefit was that there was a demand and a market to own gold,” he said.
But he said the most consequential development was the way the financial world rebuilt itself around an unpegged dollar. “In 1971, the dollar became completely synthetic because it was no longer backed by anything. And so there was a risk that the world would move away from the dollar standard. So Wall Street stepped in and created products to promote Wall Street’s future, including… money market funds… credit… mortgage-backed securities… futures, and so on.” He continued: “The dollar’s dominance by the end of that period… went from 27 percent of GDP… to 57 percent of central bank reserves and 80 percent of financial transaction prices.”
For Lee, the implications for market structure were grim: “The market capitalization of equities today is 40 trillion, compared to two trillion for gold. In other words, gold is 5 percent of all available assets.” He then signed the crypto corollary. “In 2025, we think everything will now become synthetic as we tokenize… because we’re not just moving dollars onto the blockchain, just stablecoins, but we’re going to be moving equities and real estate. Dollar dominance will be the opportunity for Ethereum. So digital gold is Bitcoin. And so we believe that in that world, Ethereum could flip Bitcoin, similar to how Wall Street and equities turned gold after ’71.”
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Crucially, Lee viewed the flipping as an industry dynamic rather than a zero-sum bet. “That’s just our working theory because I’m still a Bitcoin bull,” he said. “I am very optimistic about Bitcoin and I believe so [Ark Invest’s] goals for Bitcoin are actually achievable. So we think the fair value of Bitcoin should be at least $1.5 to $2.1 million, but we could see higher values.”
TOM LEE EXPLAINED TO CATHIE WOOD WHY ETHEREUM $ETH WILL eventually reverse Bitcoin $BTC! 🤯 pic.twitter.com/uFpoWWYHYY
— Tom Lee Updates (not Tom) (@TomLeeUpdates) October 16, 2025
In its framework, Bitcoin anchors the monetary premium of “digital gold,” while Ethereum’s neutral smart contract platform becomes the venue “where much of Wall Street will innovate” through real asset issuance and collateral flows. “That would obviously benefit a neutral smart contract platform where many Wall Street real-world assets will innovate,” he concluded.
At the time of writing, ETH was trading at $3,750.
Featured image created with DALL.E, chart from TradingView.com