9 months ago
The Ethereum (ETH) terms has crossed the $3,000 threshold for the archetypal clip since April 2022 yesterday. However, amidst the celebratory fireworks successful the crypto community, Fred Krueger, a renowned Bitcoin ETF expert, has voiced a starkly contrasting opinion. Krueger, a Wall Street seasoned and prop trader, took to X (formerly Twitter) to explicit his skepticism astir the existent valuation of ETH, stating, “ETH is wholly detached from reality.”
Why Ethereum Is “Completely Detached From Reality”
Krueger’s comments travel astatine a clip erstwhile the crypto marketplace is witnessing a resurgence successful capitalist interest, with Ethereum astatine the forefront owed to its caller terms rally. Despite this, Krueger points retired a concerning inclination successful the usage of the Ethereum blockchain.
ETH is wholly detached from reality. A heavy dive.
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ETH is astatine $3,000. Surely this indispensable mean that a ton of radical are utilizing ETH, and that this fig is lone going up, right?
Nope.
Eth, the concatenation has dropped from 120K… pic.twitter.com/141GwtB0yz
— Fred Krueger (@dotkrueger) February 21, 2024
“ETH is astatine $3,000. Surely this indispensable mean that a ton of radical are utilizing ETH, right? Nope. Eth, the concatenation has dropped from 120K progressive regular users successful 2021, to conscionable 66K implicit the past year. The apical app, Uniswap V3 is lone getting 16K DAUs. I remember, backmost successful 2020 this fig was 60K oregon more,” helium noted, emphasizing a diminution successful the platform’s nonstop inferior and engagement.
The Bitcoin ETF adept further criticized the valuation of Ethereum, drafting parallels to meme coins similar Shiba Inu owed to its inflated marketplace cap, which stands astatine $361 cardinal contempt the autumn successful progressive users. “It truly has go a benignant of meme coin, akin to Shiba Inu,” Krueger remarked, pointing to the stark opposition betwixt Ethereum’s precocious marketplace headdress and its diminishing nonstop use.
Krueger argues that Ethereum is not lone overvalued but besides faces stiff contention from different blockchains that outperform it successful presumption of transaction costs and speed. “It’s not peculiarly inexpensive ($1.50 per transaction), oregon fast. If you are conscionable funny successful reward points for games, oregon casino-style DeFi apps — Solana, Avalanche, Near etc.. each crush it.”
Krueger besides expressed skepticism astir the aboriginal regulatory scenery for Ethereum, peculiarly concerning the imaginable for an ETH exchange-traded money (ETF). “Finally, I don’t deliberation Gensler is going to let an ETH ETF… I conscionable don’t deliberation Gary wants to marque his 2nd ETF a monolithic pre-mine. Sets a precise atrocious precedent,” helium stated, reflecting connected the challenges Ethereum faces successful gaining mainstream fiscal acceptance.
The Crypto Community Reacts
In effect to Krueger’s captious take, the crypto assemblage connected X provided mixed reactions. One idiosyncratic challenged Krueger’s investigation by pointing to Ethereum’s rollup-centric roadmap and the misleading quality of utilizing mainnet regular progressive users (DAU) arsenic a metric for the platform’s health. Krueger, however, remained unconvinced, stating, “Even L2s similar Arbitrum person been successful diminution for the past 12 months. This is not the lawsuit that each is good successful ETH-land.”
Another idiosyncratic attempted to item the cyclical quality of DeFi and the broader crypto market, suggesting that the existent downturn is simply a impermanent signifier of hazard aversion. Yet, Krueger dismissed these arguments, reiterating his deficiency of involvement successful speculative DeFi activities and emphasizing his content successful Bitcoin arsenic the existent revolutionary cryptocurrency. “I americium not funny successful degen ape games. Have fun,” helium stated.
Krueger’s critique extends beyond Ethereum to the broader scenery of cryptocurrencies, questioning the semipermanent viability and worth proposition of altcoins, including Layer 1 solutions different than Bitcoin. He argues that these platforms are improbable to go important worth generators successful the agelong term, likening their power mechanisms to fiat currencies but with cardinal figures similar Vitalik Buterin successful spot of accepted cardinal bankers.
Krueger’s wide stance connected Ethereum and the broader crypto marketplace is clear. “My presumption connected ETH. At the extremity of the day, Bitcoin is the revolution… Every different cryptocurrency is warring for immoderate different overmuch smaller usage case,” helium explained, underscoring his content successful Bitcoin’s unsocial worth proposition arsenic a decentralized, finite currency system.
At property time, the ETH terms surpassed the 0.5 Fibonacci retracement level (at $2,922), trading astatine $2,935. A play adjacent supra this threshold could corroborate different limb up for the ETH price.
ETH terms breaks supra the 0.5 Fib, 1-day illustration | Source: ETHUSD connected TradingView.comFeatured representation created with DALL·E, illustration from TradingView.com
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