Joseph Lubin, in an interview with DL News, made a reservation: the situation with ether is significantly different from the situation with Bitcoin due to the basic dynamics of the supply of the asset.
“On-chain data shows that more than 27% of ether is used in various protocols on the Ethereum network. Assets are fixed in contracts and contribute to the security and functioning of the network and are therefore not available for market trading. This structural difference means that there is less ether available for ETF providers to purchase and distribute as new units,” explained the Consensys CEO.
Over time, the imbalance between supply and demand will increase. Because as network activity increases, potentially fueled by new institutional interest in the asset, the deflationary mechanism of ether burning will further reduce the available supply, believes Joseph Lubin.
Earlier, experts from Standard Chartered Bank said that by the end of the year the cost of the second largest cryptocurrency by capitalization could reach $8,000.
Source: Bits
I am an experienced journalist, writer, and editor with a passion for finance and business news. I have been working in the journalism field for over 6 years, covering a variety of topics from finance to technology. As an author at World Stock Market, I specialize in finance business-related topics.
