Investor Predicts Ethereum Supply Shock
Well-known investor Raul Pel believes that Ethereum (ETH) is waiting for a shock offer, which will help the asset demonstrate a higher yield than bitcoin
According to him, the transition of Ethereum to the Proof-of-Stake model scheduled for September will eliminate significant pressure from sellers, as the coins will be withdrawn from the market and placed in stacking. Ethereum will also benefit from the absence of miners, who often reduce the exchange rate of the asset, selling it to cover operating costs.:
"We are waiting for a reduction in the supply of monumental proportions. There will be no more miners, who often sell about 80% of the mined just to finance their activities. That is, this is a reduction in pressure on the market in the amount of $ 1 - $2 billion per month.
Currently, about 9% of the ETH supply is in the stack and volumes can grow to about 30%. In fact, 30% of the ETH placed in the stack are inactive coins. They cannot be used in DeFi protocols, CeFi projects, for shorting or providing liquidity. All this will generate a huge shock."
Pel believes that after the merger, ETH can become a deflationary asset and compared its future tokenomics with a share buyback, which simultaneously increases demand and reduces supply.
In his opinion, the ETH/BTC pair is ready to break through a multi-year descending channel, which makes ETH a much more interesting bet for macro investors:
"If we look at the chart of ETH against BTC, we can expect a breakout of the descending channel soon. I have a preponderance in favor of ETH in my portfolio and it paid off very well. I expect another round of growth. Right now I'm more interested in ETH, not BTC"
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