The Tim Ferris Show with Vitalik Buterin
If you know me, you would know that I'm somewhat of a Bitcoin maximalist but not the toxic kind. Heck, I even owned ETH at some point in 2017, those 3 ETH would be $7290 - that's almost 10x upside that I missed (although I made it all back in bitcoin). But being a Bitcoiner doesn't mean that I'm ignorant and can't see all the cool stuff that's happening in the crypto scene. I thought I would put myself in the shoes of an ETH investor and share the bull case for ETH if I were to be bullish on it.
The Overview of Ethereum
- Ethereum is so many things at once, a blockchain, a world computer, the backbone of a decentralized internet (web3)
- Ethereum is also a programmable blockchain that provides flexibility for developers to build on top of it. There are so many utility protocol use-cases that are actually really interesting
- One of the most popular examples are stablecoins. An institution can collect fiat currency, store it as collateral, and launch tokens that run on Ethereum’s protocol. They are basically dollars that make use of the blockchain
- Another one would be "DeFi" where the apps replicate banking features like earning yields or exchange tokens i.e. Uniswap
- NFTs are also an area of demand recently where pieces of digital art are traded on the Ethereum blockchain
The Bull Case 🐂
- All of the above use cases (DeFi, NFTs, DAOs) will grow spectacularly over the next few years. As more people recognize the flexibility of Ethereum, more developers will build interesting projects on it which will attract more users, and so on
- The two new proposed changes to the Ethereum blockchain (EIP 1559 and Eth2) will go through smoothly, making the transaction speed faster and the gas fees lower. Lower transaction fees and faster transaction times should lead to more transactions
- If the implementation of EIP 1559 is a success, Ethereum becomes a deflationary asset and eventually an ultra-sound money
- Owning ETH will be the equivalent of owning internet companies in the early 2000s. The demand for ETH will go up with the increased web3 adoption
In my opinion, a lot of what's happening on DeFi right now is speculative, it's not really feeding on real self-sustaining demand. And for NFTs, I believe that the recent rage in NFTs is due to all the excess capital people are making in crypto, I still can't wrap my head around the demand side of it.
That said, I'm rather intrigued on the utility side of Ethereum but I'm still on the fence about betting on the long-term price appreciation of the token itself. I can see why people would speculate with ETH since it often provides higher percentage gains during a bull market but I hope those speculators understand that Ethereum is still a work in progress.
For me, I would prefer the bulk of my digital asset portion to be in bitcoin.