Recently, renowned trader Peter Brandt twitter.com/PeterLBrandt/status/1775973571896176785?ref_src=twsrc%5Etfw” target=”_blank” rel=”noopener nofollow”>voiced Criticism aimed squarely at ethereum (eth), the second-largest cryptocurrency by market cap, denouncing it as a “junk coin” in a blunt assessment.
ethereum faces criticism
Celebrated for his insights into financial markets, Peter Brandt pulled no punches as he criticized ethereum, arguing that it lacks essential features needed for long-term success.
His comments highlighted eth's perceived weaknesses as a store of value and its struggles with layer 2 solutions and high gas fees, factors he believes contribute to its inferiority compared to bitcoin.
To back up his claims, Brandt posted an ethereum/bitcoin price chart and his criticisms of eth, showing the asset's steady decline relative to bitcoin over the past year.
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I get tired of saying it, but twitter.com/search?q=%24ETH&src=ctag&ref_src=twsrc%5Etfw” target=”_blank” rel=”noopener nofollow”>$eth It is a junk currency despite the mindless devotion of the Etheridiots.
As a store of value, it is garbage: a twitter.com/search?q=%24BTC&src=ctag&ref_src=twsrc%5Etfw” target=”_blank” rel=”noopener nofollow”>$btc suitor
Its functionality is also rubbish – it's hard to deal with L2 and outrageous gas rates.
Of course it will always attract “investors” pic.twitter.com/7KAYMiwsnf
—Peter Brandt (@PeterLBrandt) twitter.com/PeterLBrandt/status/1775973571896176785?ref_src=twsrc%5Etfw” target=”_blank” rel=”noopener nofollow”>April 4, 2024
While Brandt criticized eth, other voices presented contrasting perspectives on ethereum's prospects.
In a notable defense of the asset, JP Morgan's Global Markets Strategy team recently revealed reasons why ethereum may not be classified as a security, highlighting changes in the network's staking ecosystem toward greater decentralization.
This transition, evidenced by the decline in Lido's stake in staked eth, is seen as a positive development that could ease regulatory concerns and “bolster” ethereum's case against a security designation.
JP Morgan's analysis draws attention to the fundamental “Hinman Papers” that have shaped the SEC's approach to digital tokens.
These documents emphasize the importance of network decentralization in determining whether tokens qualify as securities, suggesting that tokens on sufficiently decentralized networks may be exempt.
Community reaction to Brandt's criticism
Interestingly, Brandt's criticism of eth sparked a wide range of reactions within the community. While some supported Brandt's assessment, others vehemently opposed it and came to ethereum's defense. Among those who supported Brandt's criticism was Adam Back, CEO of Blockstream.
Back weighed in, highlighting ethereum's vulnerability to major attacks, scams, and pulls, which have amounted to more than $1 billion per quarter. He highlighted the increasing complexity of ethereum scripts, emphasizing how increased complexity often leads to security vulnerabilities.
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Don't forget about the hacks, hacks, and manipulations of your seemingly insecure script, which cost more than a billion dollars per quarter, and which get worse over time, because complexity kills; and the ethics in charge continue to add complexity…
— Adam Back (@adam3us) twitter.com/adam3us/status/1776213571837235339?ref_src=twsrc%5Etfw” target=”_blank” rel=”noopener nofollow”>April 5, 2024
Meanwhile, another x user named Collin offered a contrasting perspective. Collin x.com/ColinTCrypto/status/1776054450366427540?s=20″ target=”_blank” rel=”noopener nofollow”>he pointed Brandt's criticism seemed “biased” and failed to “recognize eth's unique capabilities beyond bitcoin.”
He argued that ethereum's programmability sets it apart, allowing for features and functionality that bitcoin cannot replicate. Collin added:
And yes, eth fees are high. But ethereum is doing *more* than bitcoin per block. Additionally, btc fees have been incredibly high in the past ($50+ per transaction), and will *come* up again (by intentional design) in the future. So, if your complaint is high fees, you might want to take a closer look at bitcoin's future security roadmap. High fees included. In a big way. You should continue your research on this, Peter.
Featured image from Unsplash, chart from TradingView
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