While BTC is making new ATHs at a relatively low volume accompanied by "price predictions" about "The corporations" (a handful of "hedge funds with non-orthodox orientation") "are buying at any price!!1", ETH jumped from under $600 to above $700. There's a rumor that it's because the big guys are buying ETH. "At any price", indeed.
Well, first it could mean that the big guys are not willing to buy BTC "at any price" now.
Second, ETH is not BTC. ETH is actually a coin with a "use case" (its "use case" lies largely in hyperreality, but it's another story) -- Ethereum is (but not limited to) a "virtual machine" to run smart-contracts, and ETH (or rather Wei) is "gas" to fuel this machine. Ethereum is the most popular thing now to power DeFi, NFT, and custom tokens. While it may be theoretically possible to implement all this stuff on Bitcoin as well, practically today it's very much like pulling a rotten tooth via ass.
It's possible to corner BTC if you buy a shitpile of it. But ETH supply is not capped, the higher ETH price is, the more miners will come, and the more ETH will be mined. With Ethereum-2.0 the miners don't even need to buy hardware, it's enough to stake 32 ETH, and "shared staking" solutions are on the way. To corner ETH you must buy it faster than the miners mine and sell it and it will require shitloads of money.
Let's imagine ETH is cornered somehow and the price flies beyond the Moon. The miners will continue to mine and sell ETH, the transaction costs (the "gas") will skyrocket as well, and the yield farmers will move from the Ethereum-based DeFi to Polkadot, BSC, and friends. Ethereum-based DeFi is so popular because it was here first, it has a strong dev team and supporters. But will the clients (coin swappers, liquidity providers, etc.) agree to pay insane fees only to stay on Ethereum? I believe, DOT and BNB have recently pumped for a reason.
However, it's still possible to sell an idea of "ETH as digital silver", especially to those who are not interested in how the stuff actually works. At the end of the day, if the miners will keep their ETHs instead of selling them, the free-float will decrease over time.
Anyway, I would presume that the big guys are at least wealthy enough to hire a decent tech adviser, who would explain to them all that machinery in simple words. I would presume that the guys have already done that.
But what if they didn't?
However, formal logic is a surprisingly poor tool for navigation in the ocean of cryptocurrencies.
Posted Using LeoFinance Beta