• Unlike Bitcoin, Ethereum is not a commodity
• Michael Saylor classifies altcoins as securities
• Decentralization is the be-all and end-all
There is no end in sight for the current crypto winter and one can only speculate as to when the prices for cryptocurrencies will pick up again. However, as Analytics Insight writes, it is clear that the Ethereum price has followed Bitcoin to its all-time low and, like Bitcoin, has not yet been able to recover.
advertising
Trade Bitcoin and other cryptos with leverage (long and short)
Bitcoin and other cryptocurrencies have recently corrected significantly. Trade cryptos such as Bitcoin or Ethereum with leverage at Germany’s No. 1 CFD provider and participate in rising and falling prices.
There were intermittent signs of Ethereum following an ascending triangle chart pattern and a decline in price to the $900 resistance was forecast. This terrified investors, so that not even the merger announced for the Ethereum blockchain could be carried out. The volatility of the altcoin prevented the upgrade and thus a price increase. The merge should now be completed in autumn.
In an interview with Altcoin Daily, MicroStrategy founder and CEO Michael Saylor explains what differences he sees between Bitcoin and Ethereum and why he prefers the crypto veteran to altcoin. Michael Saylor, who has unprecedentedly tied his company’s investment strategy to Bitcoin, remains enthusiastic about his predictions and has long been known as a Bitcoin HODLer.
“You can’t create gold by voting”
Unlike Bitcoin, which the MicroStrategy CEO believes is a commodity, Saylor clearly sees Ethereum as a security. This distinction is important because it explains the uncertainty of crypto investors in the current market.
For Bitcoin, the Bitcoin bull tries to compare it with gold: Because a gold prospector (like a crypto miner) can hew the raw material out of the rock, but not change the gold itself. Bitcoin therefore corresponds to the image of gold, since the protocol behind it is completely decentralized and cannot be influenced from outside.
In contrast, when mining ether, the protocol can be changed by a development team through frequent hard forks. Even if it was through a relatively secure and coordinated process, a small group of people would control the coin. Therefore, there can be no central issuer for a commodity: A cryptocurrency that wants to be considered as such would have to be “fully decentralized and immutable”.
As Cointelegraph notes, however, upgrades have been made to the Bitcoin protocol in the past, with the last major soft fork dating back to November 2021.
decentralization and regulation
The risk for investors in their investments in altcoins lies in the “proof-of-stake” process with which they are mined. This is not completely decentralized and independent of the development teams, so the investments are subject to a certain arbitrariness.
In the interview, Saylor also refers several times to the “Initial Coin Offering” (ICO) process for issuing new coins, which, unlike corporate IPOs, is largely unregulated and has already attracted the attention of the regulatory authorities. A Howey test, i.e. a review of the licensing requirements for a plant by the regulatory authorities, could even lead to bans. Saylor therefore remains convinced of his investments in Bitcoin as the only truly decentralized currency.
Editorial office finanzen.net
Image sources: Bitcap, Lightboxx / Shutterstock.com