Crypto Analyst: Ethereum ETFs a Web3 Growth ‘Catalyst’

According to a crypto analyst, Ether has a “much larger addressable market” than Bitcoin since it may be viewed as a wager on the whole Web3 sector.

After recent reservations about neatly describing Ether to promote the idea of spot Ether exchange-traded funds (ETFs), Ether ETH$3,835 might have an easy-to-explain selling point after all, a possibility for investors to gamble on the future growth of Web3. This is according to a crypto analyst.

“ETH is a technological satire on the expansion of Web3. A “high-growth index for Web3 adoption” or “call option.” In contrast, Michael Nadeau, a crypto analyst for The DeFi report, stated in a May 28 study that Bitcoin is “digital gold.”

Grand View Research indicates that the Web3 sector is expected to generate $33.5 billion in sales annually by 2030.

When comparing the two most prominent cryptocurrencies using basic financial terms, Nadeau contended that Ethereum might have “a much larger addressable market.”

After spot Ether ETFs are introduced, Nadeau thinks Ether may surpass its all-time high of $4,870 set in November 2021 since there will be more demand, as was the case with Bitcoin following the introduction of spot Bitcoin ETFs in January.

On the other hand, Ethereum validators differ from Bitcoin miners in that they do not incur significant running costs. This implies that Ethereum validators increase the pressure on the demand side and are not compelled to sell to recoup costs.

“ETH does not have the same level of ‘structural sell pressure’ that BTC has since ETH validators do not incur operating expenses as Bitcoin Miners do.”

He added that, compared to Bitcoin (BTC$68,061), Ether is far more “reflexive” to positive feedback loops.

He asserted, “Price action driving on-chain activity can further drive narratives, more price action, more on-chain activity, and more ETH burned. This is one way to express reflexivity in the market.”

According to Nadeau, Ethereum offers “superior network effects” over Bitcoin and allows investors to stake Ether and receive a yield—something Bitcoin does not provide.

The remarks were made the same day when what might be the most significant Ether stake in a single transaction took place.

Etherscan data shows that $500 million worth of Ether was staked on Lido on May 28.

In a May 28 X post, Arthur Cheong, the founder of DeFiance Capital, contended that the transaction was “likely the record for the most amount of ETH staked in one single transaction.”

It comes in response to criticism from multiple cryptocurrency analysts who claimed that, in contrast to Bitcoin’s well-known “digital gold” narrative, Ethereum lacked a clear selling pitch.

Despite years of efforts, Ethereum still needs an elevator pitch, according to James Check, lead analyst at Glassnode.

After pointing out that Bitcoin is a “digital gold,” Bloomberg ETF analyst Eric Balchunas questioned whether “a simple one-liner like that [exists] for Ether? If yes, what is it?