Should Ethereum Investors Be Concerned By an Infinite Supply Cap?

ICYMI: there's been a hotly debated issue that has come to the forefront of the crypto conversation. Ethereum has an infinite supply cap and some people are concerned about what this actually means as investors in the ETH token.

ETH has had a big rally in 2020 and has more than doubled in recent weeks. The DeFi explosion has led to a lot of projects that are built to new highs. Many of these projects - not dissimilar to the ICO explosion of '17 - don't exactly have the best fundamental value in the world.

Speculation is at recent highs and so are token prices. Nothing new for cryptocurrencies.

Also at recent highs are people playing the blame game. Many are worried about things that should've been debated from the start.

Arguing about ETH's token supply seems to be a useless exercise to me. Ethereum is not intended to be a store of value asset with a fixed supply... that's Bitcoin's job.

Ethereum is a platform for innovation and development. The intention is to make a place that others can build on top of and create an opportunity for more abundance and features in the crypto space.

A Hot Debate

Unsurprisingly, this has sparked a hot debate amongst the crypto twitter crowd:

I personally view ETH (and anything that isn't bitcoin) as a speculative development project.

Let's face it, BTC is the only cryptocurrency that holds true store of value and scarcity. I classify BTC as an asset and I classify all other coins as projects.

This is not to say that these projects have no value... it is to say that BTC has fundamental value as a hard asset and these project coins are only as good as their development.

Keep your eyes open. Coins like ETH have tremendous potential, but they are still highly speculative and require a development-oriented investor mindset.

Posted Using LeoFinance