thecoinrepublic.com
- There is nearly 4 million ETH presently locked in Ethereum 2.0
- Locked funds can be used to provide liquidity for many DeFi platforms
Mark Cuban, an investor in cryptocurrencies and a billionaire, while talking to Decrypt, shares his opinion on Ether that it is going to deflate as the price ceiling is uncapped. He also believes that almost 2 million are staking in DeFi, which is the reason for Ethereum’s growth.
Ether has touched an all-time high of $3,600 in the Tuesday trading session. According to the TradingView data, Ethereum broke all records on the crypto exchange Bitstamp above the $3,600 level for the first time.
Ether that runs on the Ethereum blockchain is the second behind Bitcoin in market value. Hence, there is increasing excitement surrounding Ethereum and its capabilities. Mark Cuban, a billionaire investor, and entrepreneur has invested both in Bitcoin and Ethereum. While talking about the new all-time high of Ethereum, he said that ETH is on the way to deflation.
He explains that ETH is becoming a deflationary asset with an uncapped price ceiling. He shared his sentiments during the Ethereal Virtual Summit organized by Decrypt recently. While talking to Daniel Roberts, Editor-in-chief, Decrypt, Cuban, there is nearly 4 million ETH presently locked in Ethereum 2.0.
Ethereum 2.0 started in 2020, which is a multi-year initiative. It is likely to switch from proof-of-work (POW) to proof-of-stake (POS). Hence, ETH and other cryptocurrencies like Decentralized Finance (DeFi) and stablecoin DAI are stuck. All this movement means that ETH is on a downward stream, as per Cuban.
It is sure to be a deflation for Ethereum, believes Cuban. One of the reasons for ETH going upward stream is DAI, and ETH 2.0 is providing liquidity. It is not shocking that this will go to significant deflation. This is the reason that Cuban feels ETH is uncapped in terms of how high it can go.
Investors believe that there are many benefits to Ethereum 2.0. First, it will make ethereum faster, which means that several thousand more transactions per second on the blockchain. But there is a challenge until this transition is complete. It is difficult to predict which improvement will come to light and which will not, as per the Cuban.
Earning profits
The traders want to earn profits continuously, and for this, they lock their cryptocurrencies on the blockchain. These locked funds can be used to provide liquidity for many DeFi platforms. It can also maintain the network and validates new blocks.
Dune Analytics, a crypto platform, informed that there are 2.6 million addresses in the DeFi network. Hence, there is an intense competition that has changed the face of the community, and around 2 million people are dealing in DeFi presently, says Cuban. But this money is not going through the banking system, which worries Cuban.