Will This Cycle Skip Ethereum?
“This bull cycle will skip Ethereum”
I’ve heard this take among investors since September of 2023 at least.
By skip they mean muted ETH performance, as in ETH underperforming BTC or barely beating Bitcoin.
Now, you can approach this question as an Ethereum hater, the type who thinks “Ethereum is dead” and has been succeeded by “newer technology”. I think that’s a boring 1-D take and obviously wrong. Full disclosure: I remain a full-on ETH bull.
So instead, let’s take the perspective of a long-term Ethereum bull.
There’s two perspectives I’ve heard from my fellow ETH bulls.
1) This cycle will skip Ethereum
Why? Puberty is why. Ethereum is going through its awkward emo stage where it’s trying out adulthood and ThE WoRLd dOeSN't uNDerSTAND.
The big change for Ethereum this cycle is L2s. This is the first cycle where Ethereum is basically telling new users not to use mainnet – “Hey, we're too expensive, but the good news is we've got 100 shiny new L2s that you’re going to love!”
Bridge, fragment, frustrate, repeat.
But L2s are Ethereum!
Yeah, yeah, I know in the fullness of time that that's right. L2s are amazing, they’re the best long-term way to scale decentralization, and are Vitalik's vision, too… etc., etc.
You don’t need to tell me – I've been modular-pilled since like 2021, but the thing is, I'm not the new marginal buyer of ETH!
Who is the new buyer? It's memecoin Chad. It's app-user Stacy. It's TradFi Larry.
But Chad and Stacy are busy buying the token on the chain they're using and there are 96 distractions on L2beat. Meanwhile, Larry is buying bitcoin – do you think he really cares about onchain cash flows right now?
But fragmentation is being solved and fundamentals matter because....
Let me stop you there. I know.
Again, this is puberty. Ethereum is biting the bullet, taking the hard road, going through its necessary awkward phase in order to become a mature and well-functioning grown-ass chain while all of the toddler chains are taking shortcuts. FEW.
It's the long term play but will it pay off this bull cycle?
In this view? Nope. We skip the cycle.
2) The ETH Bull is Coming
Now, let’s look at the second ETH bull perspective…
🗣️You stupid narrative trader! Of course 10k ETH is coming… just give it a minute. BTC first, then ETH! This is how it happens!
Indeed you'd have to be a fool not to see how much stronger Ethereum is now compared to where it was in its 2020 cycle.
It’s the only profitable chain, and it's not even close! It has rock solid monetary economics. The largest exchanges in the world are launching ETH L2s. zkEVMs are here. Unlimited L2 budgets are accelerating ETH technology. We’re on the verge of ETH ETFs! Blackrock is launching tokenized treasuries… Need I say more?
Your chain has 1 million users? Cool. Ethereum is the root-chain for 1,000 chains with 1 million users a piece. Watch them eat your fees.
What about L2 chain fragmentation?
This is 100% being fixed. Meanwhile, other chains are taking mad centralization debt they'll have to eventually pay back!
Overall, it’s only a matter of time before investors wake up and start valuing cash flows instead of narrative junk food. ETH missing this cycle would be the dumbest of outcomes and is just so improbable it's barely worth considering. Markets are a weighing machine so, yeah, The ETH Bull is Coming.
There you are.
Two perspectives for ETH bulls: the Skippoors and the Waitooors.
Which one are you?