Joe Lubin commented on the prospect of Ethereum Treasury companies. Sharplink is one of the largest Ethereum holders, only being outdone by Tom Lee's Bitmine.
The interest around Ethereum seems to be growing. We recently saw news that Grayscale stepped into the ETH game in a large way.
All of this, according to Lubin, is establishing a nice foundation for Ethereum. He believes rapid scaling would result in too much unused block space. By taking the slow approach over the last 18 months, developers had time to build applications that started to utilize the space.
Joe Lubin: ETH Treasury Companies The Next Berkshire
Lubin foresees Ethereum Treasury companies becoming a centerpiece of the future economy. He equates it to Berkshire Hathaway, which is a permanent value lock company that invested in dozens of companies over the last 50 years.
Warren Buffett used a combination of outright purchase of smaller firms along with stock purchases of larger entities. This allowed him to grow Berkshire's portfolio due to a near half century run of 20% annual returns.
Lubin envisions a future where SharpLink borrows against its ETH, invests in Ethereum-centric companies, and stakes in supporting protocols.
“The real opportunity is to be the Berkshire Hathaway of the next global economy, the more decentralized global economy.”
Are We Really Talking About Decentralization?
It is difficult to envision a decentralized economy when the majority of the stake are large entities that wield enormous power.
For example, Tom Lee has a stated goal of 5% of the total ETH supply. This would make Bitmine, already the largest ETH holder, an oversized influence in the Ethereum world. Naturally, 5% is not a controlling stake but Lubin's firm is after similar numbers.
The headline above, with Greyscale staking 32K ETH is just another example. Do we believe this company is not going to keep pushing forward?
We have to be cognizant of the fact that large players emerge in every field. Look at any publicly traded company and you will see a few key holders. It is even worse in private companies where one or two people own the entire entity.
The question is whether this is a bad thing?
Whales can bring protection since they have a lot to lose. Naturally, we have to look at the nature of the whale. If it is a major fund with trillions under management, then a $200 million investment, even if large for that company or network, is nothing to them.
Surpassing Bitcoin
Could ETH Treasury companies surpass the Bitcoin counterparts?
Headed by Michael Saylor (Strategy) we are seeing a growing industry. That said, most realize that Bitcoin is not going to be the center of the financial future. Maxis like to proclaim this but the reality is the network is insufficient.
Ethereum offers a much different prospect. Of course, there is heated competition with many projecting the likes of Solana to be the major winner.
Time will reveal who comes out ahead. Ethereum does still have the advantage of first mover with smart contracts, having the confidence of many in that arena.
Yield is another benefit that Ethereum can off. This changes the models completely when looking at building these treasuries. Is it enough to surpass the Bitcoin companies?
We are looking at new entrants. The focus upon Ethereum in this regard is relatively new. We need to give these companies a year or two before we can judge where they are in comparison to Bitcoin.
Becoming central to the economy is crucial.