As well as the comments that Bitcoin will exceed the level of 100 thousand dollars by the end of the year, important predictions continue to be made about the second largest cryptocurrency Ethereum. Arthur Hayes, the former CEO of the BitMEX exchange, joined those who expected a serious price movement, especially after the "2.0 update" or, as the project team said, "Merger". Hayes also targeted the end of the year for ETH and claimed that the price level of 10 thousand dollars will be exceeded. The former CEO also said, "MicroStrategy should buy Ethereum instead of Bitcoin."
Arthur Hayes, co-founder and former CEO of BitMEX, one of the largest derivatives exchanges, mentioned Ethereum in the last of his blog posts, where he evaluated the agenda. In late 2020, BitMEX and Hayes, accused of violating the money laundering rules of the US Commodity Futures Trading Commission (CFTC), and other executives of the exchange surrendered to the US judiciary one by one and resigned from their positions in the stock market.
When the dust settles, ETH rises above 10 thousand dollars
Hayes, who remained silent after that period and commented on the agenda from time to time with blog posts, stated that Ethereum could go to the price level of 10 thousand dollars in his last article published on Friday, and used the phrase "5-digit number" in the title of his article:
“The ETH 2.0 merger will take place this year and will turn Ethereum into a blockchain powered entirely by a Proof-of-Stake based verification system. The fact that rewards will be given to validators and stakers in validator nodes in ETH will turn Ethereum into a bond. Therefore, by the end of the year, when all this dust clears, I believe that Ethereum will rise above 10 thousand dollars.”
Both government bond and commodity duty
As it is known, the update that Ethereum developers call "Unification" is expected to take place at the end of June. Once the transition to the PoS system is complete, users will be able to stake their cryptocurrencies in a wallet and contribute to the security of the network. In other words, staked Ethereums will offer a fixed income opportunity for users. This will act as a kind of government bond. Unstacked Ethereums will likely continue to have a commodity-like function.
They can get low-interest loans with dollars and stake ETH
Noting that Ethereum is not a currency, but a bond, many companies may decide to invest in ETH on the board of directors, Hayes noted, so that a new group can be included in the ecosystem. Stating that this group can invest in ETH by obtaining low-interest loans and increase the profit margin by earning high returns, BitMEX founder said:
“This finance group can invest 32 ETH by taking loans at the rate of Treasury yields. Stakes them too. Currently, the entire Treasury yield curve lies below 2.5%. Therefore, the staking returns are above the dollar loan interest rate. According to an Ethereum researcher named Justin Drake, immediately after the Merger, stakers will earn between 8 and 11.5 percent annually. If you're an Ethereum maximalist, you might not agree with these numbers, but I count it as a good prediction. The purpose of this post is not to discuss whether the return is 5% or 10%, but to analyze the scenario for Ethereum to act as a bond.”
Stating that the risk here is that there will be a price drop in Ethereum, Hayes stated that in order to lose money in the 5-year bond strategy in Ethereum, if Justin Drake's figures of 11.5 percent are taken as a basis, the price should decrease by 30 percent, adding, “Also, investors They can also hedge the bearish risk by selling the one-year ETH/USD futures contract.” said.
MicroStrategy should buy Ethereum instead of Bitcoin
Stating that many corporate companies can start to buy Ethereum after the merger, BitMEX founder also touched on the PoS and PoW comparison, which has been the subject of discussion recently, and sent a message to MicroStrategy:
“After the Merger, besides the appeal of Ethereum being a bond-like entity, it will also be ESG compliant; It will make Bitcoin more attractive than fiat and other Tier 1 assets, also called 'Ethereum destroyers', causing its value to increase later on. So what should MicroStrategy do? First of all, I have to say, Michael Saylor is a gangster! Because he uses his company's power in the corporate bond markets to buy Bitcoin. This strategy is not bad. However, Bitcoin is pure money and has no tangible returns. Ether is the commodity that powers the world's largest decentralized computer. After the merger, Ethere will bring real returns. Saylor or any investor should borrow and buy Ethereum.”