It has been suggested that Ethereum (ETH), which has been relatively sluggish compared to Bitcoin (BTC), will receive more attention from next year. The analysis is that investment demand will increase as regulations related to Ethereum's securities classification are eased after the inauguration of the next US President Donald Trump's administration.
Jang Kyung-pil, Chief Strategy Officer (CSO) of Jangle, made this forecast at the 'Blockchain and Beyond' meetup held at the Crossangle Lounge in Gangnam-gu, Seoul on the 12th. This event was co-hosted by Jangle and Scroll, an Ethereum Layer2 blockchain.
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CSO Jang analyzed that the Ethereum ecosystem is currently undervalued. He said, "BTC has already broken its all-time high and risen by 50%, but ETH has not yet reached its all-time high," emphasizing that "it will definitely be in the spotlight next year."
CSO Jang forecast that interest in the ecosystem will increase if the risk of ETH's securities classification is resolved. Unlike BTC, ETH operates on a Proof-of-Stake (PoS) basis, allowing staking. Investors who deposit ETH into the blockchain receive an annual 3-4% ETH as interest. However, the Ethereum spot exchange-traded funds (ETFs) currently traded in the US do not include staking functions. The US Securities and Exchange Commission (SEC) has banned the issuance of ETFs with staking functions, as it considers the provision of token rewards to ETH holders as 'dividends' without regulatory approval, which violates securities laws.
CSO Jang explained that "the decentralized finance (DeFi) services of the Ethereum ecosystem are recording sales in the hundreds of billions of won, but due to SEC regulations, the profits are not being returned to ETH holders." He added that "if the risk of ETH's securities classification is resolved, the ecosystem protocols can be re-evaluated."
The industry is increasingly expecting regulatory easing, as Paul Atkins, a former SEC commissioner known to be friendly to virtual assets, has recently been nominated as the new SEC chairman. If the SEC modifies its existing position on the securities classification of ETH, investment demand is expected to increase significantly.
- Choi Jae-heon, reporter
- chsn12@decenter.kr
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