Metta

Since you are here, I would like to present you a Coin in Ethereum Ecosytem with real cash flow/dividend. Straight like a stock/security: https://app.gmx.io/#/dashboard

Ethereum Layer2 has high margin (e.g 90%) but L2s is still paying fee to ETH staker(called Blob Fee). For example Ethereum Layer 2 Base from Coinbase paid millions in blob fee to ETH stakers. We can think of Ethereum with many products: 1. Block: sell directly to customers on Ethreum Layer 1. 2. Blob: sell indirectly to customers through distributor(Layer 2) Other products/services are coming also: sequencing, execution...

1. The current inflation of ETH is still lower than Bitcoin. You can compare on this site: https://ultrasound.money/?timeFrame=d30. More important is that ETH is in the growth phase, so the fee is low which is making inflation rate higher. 2. What will be the use case come out of Ethereum? Ethereum is a new kind of computing platform so there will be many kind of apps like on Apple App Store: Finance, Gaming, Social, Shoping... Here is a good overview on Finance/Tokenization use case: https://experts.bitwiseinvestments.com/cio-memos/ethereum-the-comeback-kid-of-2025

Read this to understand Ethereum is building the distribution channel(Layer 2) in growth mode.

See this analysis when compare Ethereum with Bitcoin.

The Stablecoin on Ethereum also surpassed previous cycle. Ethereum Network is in growth phase. It's scarifying Cash Flow to grow User Base and Asset Base.

This is actually very good opportunity if you are a truly value investor. Because the price is going down while the fundamental is going up. You can see below active addresses are growing rapidly on Ethereum Layer 2.

ETH: A Store of Value With Cash Flow "ETH is a unique, and differentiated, digital store of value from BTC. ETH has lower net issuance, a native staking yield (uncorrelated with TradFi), and a value capture mechanism from activity in the Ethereum economy." Link: https://www.etherealize.io/content/eth-a-store-of-value-with-cash-flow

Hi. Here are my answers for your questions. 1. The txs fee on Ethereum Layer 1 is expensive and is not designed for retail with small amount. Retail can transfer USDC on Ethereum Layer 2 like Base(from Coinbase) for FREE. Stablecoin is superior for International Transfer. For domestic transfer, it will not make much different. 2. About high yield, let start with a real life example. Tether - the issuer of USDT stablecoin - is projected to earn at least $5B in profit in 2024. With PE = 20x, Tether Equity will be valued at $100B. Now, "Usual Protocol" is a new competitor with Tether. Usual issues USD0 and holders of USD0 will also receive Usual Token Incentive(similar to ESOP). The current APY right now is 38%: https://app.usual.money/. I really admired your curiosity. Most Value Investor just auto write off Crypto because Warren Buffett and Charlie Munger don't like Bitcoin. I am not a fan of Bitcoin myself but I think crypto is much more than Bitcoin now.

First, we have to admit the fact: Stablecoin has growth 200x in the last 5 years. Second, what are the reasons for this growth? Why there are so much demand for Stablecoin? I can think of a few reasons: 1. People in high inflation economies like Turkey or Argentina want to hold dollar. Stablecoin gives them that. 2. People want to buy crypto assets. They have to exchange dollar in banks to Stablecoin first. Then many people take profit from crypto but hold their money in Stablecoin so they can come to market quickly. 3. People can earn high yield with Stablecoin. Like really high yield. 50%, 100%... You must understand DeFi and Airdrop to understand the high yield... 4. Stablecoin is a really good international payment. For example, if you work in US, you can send USDC, USDT back to your family in India, Philipine... for basically FREE. Now, why do you want to tokenize Equity? I agree this is a tough case now. Mainly because of liquidity. US Stock Market has a huge liquidity now. I think TBill and TBond will come Onchain first. It naturally happen because Stablecoin holders want to access the Gov Bonds. Slowly then, Crypto will become the real Global Capital Market with deeper liquidity than many developing markets. Companies in those small markets will want to list their Equity on Crypto Capital Market. As Liquidity begets liquidity, it will come to a time all companies want to list their equity on Crypto. Maybe in the next 10Y. In 2000, you may ask why would you put every information on the Internet? In 2024, now you ask why would you put every assets on the Blockchain?

Since Ethereum is a Turing-complete computer, there are many applications on Ethereum: tokenization, finance, social, prediction market, identity, gaming... Let's start with dollar which is the first tokenized asset through Stablecoin. Ethereum holds 60% market share in the Stablecoin. Larry Fink from Blackrock(who popularized the MBS and ETF) predicted that almost every assets(bond, equity, real estate...) will be tokenized and trade on the public Blockchain. Think like $100T of assets will be tokenized and trade on Ethereum(Layer 1 + Layer 2). How much transaction fee Ethereum can collect in that scenario?

Transaction fees (gas fees) on the Ethereum network are split into two main components since the EIP-1559 upgrade: Base Fee: This portion is "burned" (permanently destroyed), removing these ETH from circulation. This was implemented to make ETH deflationary under high network usage. Priority Fee (or "tip"): This goes to the validators who process and validate transactions. You "stake ETH" to become a Validator. Base Fee is similar to stock buy back and removed from circulation. Priority Fee is similar to dividend for ETH holders who staked. ETH Stakers also got income from Token Incentive. The current total yield for Staked ETH is around 3% APY.

I think this is a real stress test for the bond market and then every other asset classes like Equity or Crypto.

No, I did not say that Value Investing is dead. I also think that there is a lot of bubble/stupid in the current Crypto Market. But I want to say there are also a lot of legitimate projects in the Crypto. The valuation may not attractive right now but we dig into it the understand more. Just like after Dotcom, a lot of internet companies like Amazon, Google...immerged.

What is really the Value Investing ? Buying low PE, low PB, low PS? Closely follow WEB? I used to think so but now I think Value Investing is about "see the real Insights when others don't"

3. This is a transaction by BlackRock on Ethereum. BlackRock has to pay fee in ETH for this transaction. => This makes the case for ETH the Consumable Asset. https://etherscan.io/tx/0xba5d34a2a0f57acfc5a923658392dad50ddf0f2e1a64ab3a50b5430702d9b1c2 Note: Bitcoin also has these 3 characteristics but characteristics 1,3 are much worse than characteristic number 2 because the transaction fee revenue on Bitcoin belongs to Miners and is very modest. Transactions on Bitcoin are not suitable for real life because they are very slow and have high fees.

2. ETH is non sovereign asset. Its supply has decreased over the last 2 years. This makes the case for ETH Store Of Value Assets. It

1. This is the fee collected by Ethereum last 30 days. Annualized is $2.6B => This make Ethereum a Capital Asset.

3 asset characteristics of ETH: 1.Capital Asset. Like Apple or Google stocks, holding ETH is based on Ethereum network's revenue, profits, cash flow, dividends... 2.Store Of Value Asset. Like Gold, Bitcoin... ETH is a non-governmental asset with scarcity, can protect against fiat currency inflation, and has high liquidity. 3.Consumable Asset. Like Oil or Real Estate... ETH is a commodity that can be consumed (transaction fees) and will be an essential consumption need in the future. Because this is the first time in history that an asset possesses all these 3 characteristics, no one in the world knows how to properly value ETH. Reference: https://www.bankless.com/ether-a-new-model-for-money

Hey @Parsad Curious about your view on ETH and Ethereum Layer 2 now since Ethereum L2s are growing rapidly.