For years Ethereum has pushed the “ETH is Money” narrative, through meming “ETH is Money” on Twitter, to changing issuance from PoW to PoS, and then burning ETH transaction fees through EIP-1559.
But improvements to Ethereum’s monetary supply schedule have failed to translate into price action against Bitcoin The protocol changes have worked economically: they’ve reduced Ethereum issuance well below that of Bitcoin. But practically, they’ve failed: They haven’t worked in pushing ETH as a store of value against Bitcoin.
What has actually driven ETH price over the years? It’s demand for ETH itself : in 2017 this was through ICOs. In 2020–21 it was through ETH as an asset for DeFi, and demand for ETH as gas as DeFi on Ethereum exploded.
But as demand for ETH as gas on L1 is reduced by usage flowing to L2s, what could possibly drive demand for ETH in the future?
Ethereum is the Internet You Own
Few people know Ethereum’s origin story: in 2010, a young Vitalik Buterin was playing World of Worldcraft, but a software upgrade from Blizzard changed his character’s abilities, weakening his Warlock’s capabilities, and showing Vitalik the dangers of trusting centralized parties.
The value of Ethereum isn’t mainly that it is a better money than Bitcoin — that narrative isn’t strong enough outside of Ethereum Twitter when holders cannot trust the protocol to not change its issuance in the future.
Ethereum’s value stems from its’ rock solid protocol layer assurances and its programmability. Ethereum allows us to recreate the internet of Web2, but this time give ownership and control back to the users.
Ethereum is Sovereign State Attack Resistant.
Solana has gone down before, its founders sport US flags in their twitter bios, and its high validator requirements result in centralization. Binance smart chain and Tron, two other popular blockchains, don’t even try to hide the fact they’re centralized. Aptos’es token distribution favored VCs and Insiders.
Ethereum is the only blockchain used at scale which has never gone down, and which prioritizes decentralization, with globally distributed nodes and validators, distributed tokenomics, and even decentralized development — with core developers distributed all around the world.
Wherever you are, whether it’s in the US under Operation Chokepoint, Turkey where inflation runs rampant on the Lira, or even China where there are strict capital controls, you know you can buy, hold, and trade assets on Ethereum, an independent, international network secured by over $300B of decentralized economic security, without needing to trust any single party to not scam you or go bankrupt.
From financial assets like Stablecoins, ETH, or even wrapped bitcoin or tokenized gold, to art in the form of NFTs, or game assets, you can be assured that the assets are in your wallet, not in a bank’s custody, and they won’t be taken away even by nation state actors.
Web3 is the Internet You Own
Web2: social media like facebook, twitter, and Reddit, was driven by user generated content. Web3 is being driven by digital ownership. From financial assets to art, to user generated content, to your own social data, people are waking up, just like Vitalik did, to the fact that trusting third parties is not a good long term solution.
And for those people, Ethereum will be there: driving the Internet You Own.