Ethereum’s value lies not only in its technological capabilities, but also in its networking effect, said Ran Neuner, co-founder of Crypto Banter, host of CNBC’s Crypto Trader and CEO of OnChain Capital.
Speaking to Michelle Makori, editor-in-chief of Kitco News, Neuner said that if Ethereum had a price with comparable network metrics like Bitcoin, the price would have to be several times higher.
“If you compare the location of the Ethereum network to the Bitcoin network and say similarly, how should you trade Ethereum? You get a valuation, according to Metcalfe’s law, of Ethereum at about $ 6,000,” he said.
Ethereum is currently trading at $ 2,400 and is therefore “very, very undervalued,” Neuner noted.
Still, the similarities between Bitcoin and Ethereum end here.
“I think comparing Bitcoin to Ethereum is really bad … it’s like comparing gold to Amazon,” he said. “The only thing is that they’re both cryptocurrencies and they’re both used in blockchain, but they’re two completely different things. Bitcoin is a store of value, it’s a transfer of value between you and me. That’s what Bitcoin does and “Ethereum, however, is a decentralized global supercomputer.”
On Dogecoin, Neuner said that cryptography that shot up more than 500% in less than three days in mid-April has no intrinsic value and is a pure work of speculation.
“Dogecoin is, at best, a meme currency. It is a useless piece of technology, insecure. It was designed as a joke, it was designed as a meme. They called it a small currency, ”he said. “It was badly designed on purpose.”
Also, unlike Bitcoin, there is no finite amount of Dogecoin, as more can be created. Neuner compared this feature to the US dollar, another currency that does not have a hard supply limit, which he also referred to as a “meme currency”.
The popularity of Dogecoin was driven in part by TikTokers, which sees it as a kind of “currency of freedom,” according to Neuner.
“What happens next? One of two things: one, it crashes, all these TikTokers are erased and it’s just another one of those bomb and dump schemes. Dogecoin has done it [this] several times since 2017, it goes up and somehow goes down. Or two, the TikTok generation really adopts this as a cryptocurrency, ”he said.
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