Ethereum’s Rise: Understanding the Shift from Bitcoin to ETH

Mm.

Investment products saw significant outflows in early September with $912 million pulled from EF funds in just one week.

But this does come as overall crypto fund trading volumes fell 27%.

Meanwhile, the crypto venture market saw a strong momentum last week with 22 projects securing a combined $185 million in funding, the largest.

Funding round came from Ethereo Live, which raised $40 million to build an institutional marketing and product arm for Ethereum.

Joining me here at the Exchange is Vivek Raman, CEO of Ethereal Live.

Well, Vivek, great to have you here.

Thank you so much for joining me.

Thanks for having me again, Ray.

Great to see you.

Here we are.

We're keeping a close eye on its prices.

So what's driving price action right now?

I think we had one of the most monumental summers where all of the move from the last 3 years that people were waiting for it all caught up this past summer.

We saw a tremendous amount of ETF inflows through July and August, $8 billion or more of inflows, and we actually saw higher inflows to EPTFs than Bitcoin ETFs.

So you started to see EPTF inflows pick up.

You saw over $10 billion going to digital asset treasuries, and you started to see that chat GPT moment that a lot of people like to talk about start to blossom and E's potential really started to shine.

So it repriced very sharply.

I think last time I was here.

We were some 2000.

Now we're up to react.

Yeah, you bring up an important point because here we are after Labor Day and we're just talking about what a busy summer it's been and when we're looking at ether prices, we did see it in higher above that key level.

So when we're looking forward to ET and this dominance that we're seeing, this rotation from Bitcoin to ES, what's really happening and what's driving all of this?

I think that E is where Bitcoin was 5 years ago at the cusp of real institutional adoption.

Bitcoin cemented itself.

It took 10 years, but it cemented itself as a store of value.

People are now thanks to EBTF volumes and the Treasury companies largely seeing ET as a productive store of value that you can build an entire economy on top of.

So as we're seeing stablecoins blossom and the stablecoin bill got passed into law, people are seeing the real potential of ET is.

Beyond stablecoins, it's even tokenization.

It's decentralized finance is building a whole economy, so that is secular momentum that's happening and that just started.

So I think ET's move just started, Ethereum adoption has started, and that's why we're excited to jump in and get to our next phase.

Yeah, and many of us are paying attention to what's happening with DAs and those are digital asset treasuries.

So why ET and why now?

I think it is the best asset to put in a digital asset treasury.

I think it started with Bitcoin and microStrategy built up a war chest of Bitcoin, which is amazing.

But Bitcoin is not productive.

It doesn't have yield, doesn't have net income generation.

ET does.

Eth has a stake in yield.

ET has a decentralized finance economy where you can use Ethereum within that economy and generate diversified sources of yield.

So ET is really the yield platform and the tokenization platform, and so it makes sense that we'd see a huge catch up in digital asset treasuries.

Led by Tom Lees and a bunch of others, and the good part is each one can be differentiated, have its own identity, have its own yield, and I think it's going to amplify each position as an institutional asset very, very quickly.

Yeah, and Vivek, of course, while I have you here, I do want to ask about the latest funding rounds.

So tell us about this and how will you be measuring success when it comes to this.

I think now that people understand Ethereum's potential, I think that now that we've passed the stablecoin bill and the genius and I'm sorry, the Clarity Act is potentially up and coming next.

Institutions are ready to adopt blockchains in en masse.

I think we are ready to embed blockchains into the infrastructure for Wall Street, but Institutions need help, so we have put together the best engineers, the best players in the Ethereum ecosystem to build products and infrastructure to help all institutions tokenize their assets, put them onto Ethereum.

Um, include things like privacy which blockchains have been lacking historically but is ready now and really bring the next wave of assets and activity onto the Ethereum ecosystem.

So I'm really excited to do that.

OK, Vivek, well, we have like 30 seconds here, so I do want to ask you about why we're seeing Trad y moving towards Eth right now.

I think Ethereum has been around other than Bitcoin.

It's the longest running.

It's the most battle tested.

It's never had any downtime.

It is really truly decentralized infrastructure.

It's like the internet.

So we're seeing that internet moment now happen for finance largely because the regulatory winds have changed.

Now Wall Street's allowed to adopt blockchains.

They're allowed to use the benefits of ET, which is being public and decentralized and secure.

So there is a gold rush to token.

As many assets and bring them into the Ethereum ecosystem, either Ethereum base layer or onto their own customized layer 2s, and that starts to look very, very compelling.

We're going to see people cut costs, unlock new revenue opportunities all within the Ethereum ecosystem.

It's the most positive sum technology to come to Wall Street in the last 20 years.

I think Ethereum is, along with AI, are the two biggest technology shifts ever, and I'm excited to see its potential.

OK, Vivek, great having you here.

Thank you so much for joining me.