Ethereum’s influence on finance and tech may still be a mystery to many on Wall Street, but some analysts believe it’s primed for a breakthrough. Leena ElDeeb, an analyst at crypto asset manager 21Shares, believes people should see Ethereum as Amazon did in 1990.
Ethereum: The Next Amazon in the Making?
At the time, Amazon was a powerful technology with massive potential but hadn’t become obvious to everyone. So, people didn’t pay much attention. Just as few could have predicted Amazon’s leap from a simple online bookstore to a global powerhouse. ElDeeb believes we could see a similar story to Ethereum.
Ether ETFs finally hit the market in July, and that was supposed to be Ethereum’s big breakthrough in the mainstream market. But inflows haven’t been so encouraging. Why’s that? Well, ElDeeb believes that’s because investors don’t see Ethereum as a big deal yet. Unlike Bitcoin, most investors lack a clear understanding of Ethereum’s use cases. Ethereum isn’t like Bitcoin, which is largely used for transactions. Instead, Ethereum is the powerhouse behind the DeFi space and other sectors.
ethereum is the future of internet
and i just spent this weekend going through @VitalikButerin‘s five-part ethereum roadmap – there’s a lot of exciting stuff ahead.
here’s everything i learned, explained in simple, short and easy english:
part 1 – the merge:
– making proof of… pic.twitter.com/O2Sw9JFYdM
— Suhail Kakar (@SuhailKakar) October 27, 2024
More Like Amazon
Brokate, head of 21Shares’ U.S. unit, draws another comparison with Amazon, noting how both started with modest goals but are set up to revolutionize industries. Although there’s a great difference in their valuation, as Ethereum’s market cap is around 6% of Amazon’s valuation, Brokate highlights an edge that Ethereum holds.
The blockchain network has a developer base of over 200,000 people dedicated to expanding its ecosystem. This level of innovation and manpower could push Ethereum’s growth much faster than Amazon’s early years.
📈 Ethereum is being compared to Amazon in the 1990s by 21Shares! 🚀
🔹 Just as Amazon transformed from a bookstore to a tech giant, Ethereum may surprise us with revolutionary use cases we can’t yet envision.
🔹 With 200,000+ active developers, its potential is vast, but many… pic.twitter.com/o0dircDqRw— Crypto B 👑 (Never DM first) 🇧🇷 (@TheCrypto_B) November 4, 2024
Ethereum’s journey to its future is not all smooth sailing. The blockchain platform has some hurdles to face, especially competition from rival layer-1 blockchains like Solana. Regardless, the guys at 21Shares believe Ethereum holds a tight grip on decentralized exchanges, lending protocols, and stablecoins.
Although Ether ETFs have recorded poor inflows, the Ethereum network has enjoyed interest from institutional giants like BlackRock. The asset manager has tokenized over $533 million, and the Union Bank of Switzerland (UBS) recently launched a tokenized fund. Payments giants like Paypal and Visa are also building on the network. These are signs that the top guys recognize Ethereum’s potential.
If Ethereum is dead, then why are the world’s largest financial institutions launching products on it?
– Blackrock
– Franklin Templeton
– UBS… pic.twitter.com/KI9LIAFZ1I— Ryan Rasmussen (@RasterlyRock) November 2, 2024
Investors need More Clarity
Still, 21Sharees believes these are just a handful of firms that understand Ethereum’s potential. The cautious pace of institutional adoption has raised questions. Brokate and other experts say that traditional investors are waiting for more clarity on Ethereum’s long-term value.
Katalin Tischhauser, Head of Research at Sygnum Bank, believes that recent ETF inflows reflect this hesitancy. She expects that once investors see the bigger picture and understand Ethereum’s role in finance, interest in Ether ETFs could shift dramatically.
Bitcoin Spot ETFs Saw $541.1 million in net outflows on November 04, and Ethereum ETFs recorded $63.2 million outflows. 👀 pic.twitter.com/xyDDzOcKRJ
— Crypto Crib (@Crypto_Crib_) November 5, 2024
For Brokate, these early revenue dips are less a cause for worry than a step toward long-term growth. Ethereum may still be an underdog in the eyes of Wall Street, but with a thriving developer community and a growing list of use cases, it’s positioned for a future that could surprise even the skeptics.
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