10 Objectively True Reasons ETH is Bullish I David Hoffman

All [Music] right, our second last talk of the day. For this one, I'd like to bring on David from Bankless to tell you about 10 reasons to be bullish on ETH. Please give David a big round of applause.

Hello everyone. Uh sup reasons to be bullish ETH specifically 10 reasons that even John Charo cannot argue with. And the reason why I'm motivated to do this, why why I want to go through this exercise is I want to find 10 objectively true, non-hypy, non I've already swallowed the ETH pill reasons as to why ETH is bullish. Uh I spent some time uh with people the likes of John with the likes of Mike uh Epilo from Blockworks. I've spent some time in the Blockworks extended networks uh of people and so I know how they think.

Uh and you know I think that the Ethereum community kind of discounts um their what the Blockworks extended ecosystem and how they think and why they think the things that they do. And so this is an exercise in trying to articulate 10 bullish reasons uh about ETH for more of a broad audience. you know, people that are probably not in this room actually. Uh, and trying to keep down the levels of hype while keeping up the levels of objectity, objectivity. We're going to see how well, uh, we are able to do that.

This is my friend John. John has ED, Ethereum derangement. Uh, a lot of people actually have Ethereum derangement on Twitter. It's like, I don't know, 20% of people on Twitter have ED. We need to cure.

But we as a community need to cure ED on the in the broader crypto community because there's a lot of people with ED out there. Uh and so that's what we're going to do uh today. We're going to cure John's ED so that we can solve other people's ED as well. It it plagues everyone and it's bad. You know, we want to we want to fix their ED so they can live a normal life, you know.

Uh number one, ETH has the lowest inflation of any layer 1 ever. That's inclusive of Bitcoin. Over the last uh uh two almost three years, two years, 330 days, uh the total network inflation of Ethereum has increased.13%. Uh Bitcoin is actually 10 times higher in terms of issuance uh since the last rounding up to to three years.

Uh we'll see how that goes in in the future. But if you are just talking about the monetary issuance of net new coins into the market, ETH is 10 times lower than Bitcoin. Now, how many bitcoins are there? Somebody shout out a number wrong. There's something like 19 million.

8 million uh bitcoins out there and the rest will be minted over the next hundred years. So there in the future there will be 21 million but right now bitcoin is inflating at 1.3% a year for the last two and a half years. Uh ETH is lower than that. That's pretty cool to me.

That is the most sustainable most scarce monetary issuance into uh the crypto ecosystem. No other network, no other layer 1 can boast numbers that low. Uh this is a tweet from DC investor that I really liked. Blockchain fees uh need to sustain a security budget, but they don't need to sustain fees in excess of that. Ethereum has the best security issuance model in all of crypto right now by a fairly wide margin.

It doesn't need one guay or one dollar of revenue beyond that in order to be valuable. What's he saying here? He's diminishing the value of REV because he says the point of a layer one uh of fees at the layer one is just to make sustainability happen because we don't know when 21 million bitcoins are minted how bitcoin is secured after that. Uh and so I like this tweet from DC and that's that's why you can see Ethereum has the burn but we don't need it we don't need it to go down is what he's saying. We don't need this blue line to go down.

We just need it to be sustainable so that Ethereum can be here for our kids and our kids kids and our kids kids. Number two reason to be bullish Ether DeFi. There's reservation demand for Ether, the asset built natively into Ether, the protocol. I think that is the coolest thing about crypto as a whole. I actually think DeFi is kind of like the main quest line of crypto.

And it's so cool that you can make a smart contract platform and then the smart contracts on that platform can create reasons to use and hold and have reservation demand for the native currency of said platform. And so there's 8.7% of all ether is inside of a 5.6% of all ether is inside of iigen layer. 2.

2% of all ether is in etherfi. Do you know how much ether Tom Lee has? 1%. 1%. A's got almost nine.

I like that nine percent. That's nine Tom Lees that A has layer's got 5.6 Tom Lees. That's pretty cool. And those are all growing, right?

Spark, Morpho, Ethereum, these are all relatively recent. IEG layer. Uh, and so I I want DeFi to grow. And it's just really cool that you could have a self-referential ecosystem just create demand for the native currency. I think that's pretty cool.

Can't argue with that. Can't argue with uh the the native the layer 1 applications just sucking up like 14 15% of the total supply of ETH. That's pretty cool. Number three, ETH is the world's most productive asset. Uh what is uh productivity?

Productivity, who remembers money legos? Hopefully everyone. Uh productivity is just when you can recycle the capital in your asset over and over and over again. So I take my Ether, I stake it in Lido, I get the E staking rate. I take that, I put that in a I borrow USDC, I farm USDC for 7%.

You're using the value of your ether multiple times over and over and over again. And that is uniquely created via money Legos. First with individual DeFi apps and then stacked together DeFi apps. You can't do that anywhere else. Technically, you can do that on any platform that has smart contracts.

You can build DeFi apps. You can build DeFi Legos on any smart contract platform. Only Ethereum has a truly robust uh and strong money Lego structure. What are the DeFi apps on on uh alternative chains? Like they're kind of like one-offs.

Nothing really has the level of maturity and security that Ethereum's DeFi Money Legos ecosystem has. So you have the number one most scarce asset by issuance inside of the most robust DeFi system creating the world's most productive asset. Which brings me to my fourth point, longevity. What does a store of value do? How what is a store of value?

What is a good store of value? I judge a good store of value as something that can just teleport wealth from one point in time into the future with minimal loss. It's lossless value transfer across time. And Ethereum is built in every single way for longevity to be able to be handed down to our kids, our kids, kids, our kids, kids, kids. That's why we have multiple clients.

That's why we don't juice the layer one. We want to make sure that Ethereum is built so that it can withstand World War II. That's why we talk about World War II resistance. So, we have the most scarce asset by issuance with its own internal reservation demand being able to become the most productive capital asset in the world that we can also pass down to our kids and our kids kids and our kids kids. So, that's pretty cool.

Number five, Ethereum has a pretty unique brand. All of these, one of the reasons why I think ETH has had this momentum recently, I think it actually started with a circle IPO is my this is the first canary in the coal mine that got a lot of excitement around uh Ether test. Oh, okay. Uh specifically, uh the Circle IPO in my mind is very Ethereum coded. Ethereum known as a stable coin chain and tradi.

Uh circle spawned USC on Ethereum. Uh it grew on Ethereum. Yes, USC is elsewhere, but it's really was fostered on Ethereum. Uh, and then after the Circle IPO, which did great, then you like had Robin Hood announce its layer 2 chain on Ethereum. And that's different than when Coinbase builds a layer 2 chain because Coinbase is highly incentivized to grow and foster its own ecosystem.

But Robin Hood doesn't necessarily have that same mandate. Robin Hood is a Trady company looking in at crypto being like, you know, what can I do here? And they decide to build a layer 2 on Ethereum. And then of course you have Black Rockck with the ETH ETF and also the Battle Fund and tokenized assets on the layer one. Now these aren't brands that are beholden to Ethereum.

Like there are assets that you know Robin Hood has like Salon on the asset and Circle has USC and other chains but everyone starts with Ethereum. This is my friend Robbie Mitchnik. Not actually my friend but he's been on the podcast so therefore it's my friend. Uh there's no question that the blockchain we would start our tokenization would be on Ethereum. Now he says the word start so he he could imply that there's going to be other places and the bidd is on other chains but the fact that he that everyone knows that you start on Ethereum is going to produce some sort of network effects around Ethereum that is something that is unique to Ethereum.

Here we have John's uh ED manifesting here. Uh so we have Vitalik talking about what value Ethereum brings to the table. Vitalik says like why is Ethereum good? It's because we promote long-term resilience, credible neutrality, flexibility, while prioritizing security. These are the properties that all of these brands have chosen Ethereum for.

This is why Robbie is saying, I'm going to start my tokenization journey on Ethereum and so is everyone else in the world. And then Tom Lee says, well, Ethereum is a chain that Wall Street has chosen. And then Tom John is like, well, ETH is a momentum trade because Tom Lee is buying it. If he didn't have ED, he would actually look something like this. ETH is internet money.

And so if you cure people of their ED, they they start thinking like this. ETH is internet money. Uh do I want to talk about this? Uh this is totally talking about how economic security is a meme. And John's retweeting it.

Economic security is a meme if you don't believe in passing down blockchains to your kids and your kids' kids and your kids kids. Totally. is like, "Oh yeah, if the network just goes down, um, the node operators will just talk to each other and somebody's got a copy of the ledger and so we'll just restart it." As if you don't believe in in economic security. But that's not why all of these people who demand 100% uptime, which is number six, 100% uptime, that's not why all those brands have chosen Ethereum.

So there's this trust uh that Ethereum has garnered over the years has showed up with adoption by some of the most prestigious brands in crypto. Who knows how much uh AUM Black Rockck has 10 trillion. It's 10 trillion. I actually looked it up this morning. It's 10.

01. Google had the 01 in there. uh when they go shopping around and how they going to spend that money or where they're going to put that money, what kind of qualities do you think they're looking for when they want to tokenize things or trust their clients funds with? They want something with long-term resilience, credible neutrality, flexibility while preserving security. All the brand, all the things that Vitalic has been emphasizing.

And so that's why Ethereum has earned the trust of somebody like Black Rockck and all these other institutions that are coming onto Ethereum. The EVM network effect arc uh from Circle just got announced the new Circle Corpo chain. Same thing with Stripe and Paradigm building uh Tempo the EVM compatible corpo chain. And then the Robin Hood chain literally a layer 2 on Ethereum also call it a corpo chain. All these are the EVM.

This is all the Ethereum virtual machine. And what's cool about this, especially the Robin Hood chain, because Robin Hood is again a Tradfy institution, because they are building the Robin Hood chain, they're working on the EVM. They have to hire EVM developers to run and maintain the Robin Hood chain. And so this is my metaphor to extend this. In Web 2, in paper, pen and paper logic before blockchains, Wall Street runs on Microsoft Excel.

Today, they run on the Ethereum virtual machine. And so just as a standard, as a skill, as a proliferation across over there, all the the EVM is going to be all in those buildings. People in those buildings are going to know how to use the EVM. I actually should point down there because that's fi down there. And so Microsoft Excel today, the Ethereum virtual machine tomorrow.

And it's just a standard that is going to be proliferated, adopted, and just built into what it takes uh to run Wall Street. uh adaptability and governance. Uh raise your hand if you're in this photo. Ben, raise your hand. Anyone else?

It's a few other people. Uh okay. Um this is an admitting that yes, in the future, Ethereum will need to change. It'll need to adapt. The future is uncertain, unknown.

And this is how Ethereum adapts. Big public Zoom calls on YouTube. And so when quantum comes or when some and when aliens land, Ethereum will be able to adapt, but it does it in public, it does it in open, it does it in a way that makes all of these brands feel very good because they can see what's going on is inside out. And I declare that that is good for ETH because that's a good it's a good look. It's a good look for all of us to to gain trust.

And trust is what money is about and ETH is internet money. Uh Tom Lee, Tom Le's pretty bullish ETH because he's buying uh 5% of it is what he says. He's got 1%, he wants 5%. Uh Tom Le is bullish, but it's not just Tom Lee. We're not putting our our faith into the hands of Tom Lee.

Tom Lee is emblematic of what ETH is and why ETH is what it is. Uh and that's displayed in this chart. Uh we are here large institutions and pension funds. That's Tom Lee. That's who Tom Lee represents.

Uh, and we can go back into the dark ages a mere three months ago when ETH was uh $1,700 and Bitcoin was $100,000 and um, Michael Sailor was buying as much Bitcoin as possible and that's why Bitcoin was $100,000 and no one was buying ETH, which is why ETH was $1,700 dark times three months ago. Um, now it's 4,000. is almost basically at all-time highs and that's because ETH as an asset has these properties that makes it very interesting to people like Tom Lee. Why? Let's go back because it has long-term resilience, credible neutrality, and flexibility while preserving security and then all all of these things as well, you know, the money like and so all of a sudden Tom Lee is like, "Oh, there's a story here.

There's a use case here. There's value here. I think ETH is the backbone of Wall Street." That's literally a word. It's the backbone of Wall Street.

Ethereum is the backbone of Wall Street. The EVM is the backbone of Wall Street. And that makes ETH a really good a really good buy. And so I'm going to buy 5% of it. And now there's like five Tomley's all doing the same thing.

ETH earned that position. Ether, the asset, the nature of ETH the asset earned that position. We earned our Tomy. Tomley didn't come to and and save us. We gave Ether gave Tomley an opportunity.

Uh last one. There's no second best. There's no second best. What do I mean by that? On the left, you got Bitcoin.

Bitcoin thinks security is critical. Economic security is not a meme. According to Bitcoin, security is is critical. Money is the biggest ham and scaling happens in layers. These are the Bitcoin beliefs.

Then on the other side, you have smart contracts are kind of like the main quest line of of crypto. Upgrading is necessary. We need to upgrade. Technology improves and change should go fast. And in the middle, you have ETH.

There's only one crypto asset that inhabits this middle position. There's only one that believes in the monetary value of internet money, money natively on the internet, a bankless money system that also thinks that smart contracts are dope. Remember number two, number one, two, and three. Uh burn from smart contract demand, uh DeFi, reservation demand, and the productivity that Ether has because of smart contracts. uh and that upgrading is necessary so that we can stand the test of time.

We can send our ether to our children and our children's children and our children's children's children and uh change should go fast. There's only one asset in the center and that's why there is no second best to ETH. Uh and so John's going to watch this in the future uh and he will notice that uh his ED is now cured and hopefully many other people watching this as well. Uh and so thank you for helping me rid uh crypto Twitter of ED. I appreciate that.

Cheers. Thanks. [Music]