- My thoughts regarding ETH’s relative price potential have shifted to negative over the last few months. I’ve made note of a few observations that have led me to this conclusion below.
- From a technical perspective, ETH’s inability to mount a rally in dominance is concerning. January to March is historically the strongest 3 month stretch of the year for ETH, thus leading to sector outperformance. No such luck so far. If we isolate the presidential cycle, ETH again fails to live up to its seasonality. Both 2016 and 2020’s rallies began in January. The rally that began this year has already faded 50%.
- Everywhere I look in the crypto sphere people are pounding the table at how it’s time to buy ETH. I was quietly in agreement at one point, largely due to the microeconomic tailwinds. ETH has by far the greatest number of developers, it is next in line for ETF approval, and there are several major protocol upgrades incoming (including the recent Dencun upgrade). Despite these drivers, ETH’s dominance remains flat.
- I heard someone ask, “if Ethereum were released today, would you invest in it?” If I’m being honest with myself, the answer is most likely “no.” There’s just too much to fix. It’s an incomplete product full of issues while other layer 1’s appear more evolved. The large developer base appears to be its only star quality.
- If ETH is unable to initiate a dominance run soon, I fear it will end up in the graveyard alongside the other failed blockchain projects as people become less and less interested over time. Hopefully this post is embarrassingly mistimed and ETH surges, but I doubt it.
