In light of this Ethereum version of the 'Micro Strategy Summer' craze, can ETH really replicate the 'positive flywheel' of BTC micro-strategy? Here are several personal viewpoints:
1) The ETH micro-strategy is indeed a successful model that emulates the BTC micro-strategy. In the short term, many U.S. stock companies will attempt FOMO and form a wave of positive flywheel. Regardless of the trading entities in the U.S. stock market, the real money from traditional institutional funds and retail investors buying in with ETH as a reserve asset has substantively pulled Ethereum out of a long-term state of weakness.
In other words, the rise driven by FOMO is an unchanging iron law of the crypto bull market. However, this time, the FOMO entities are no longer pure retail investors from the crypto space, but real money from Wall Street. This at least confirms that ETH has finally broken free from the predicament of solely relying on the stacking narratives within the crypto space and has started to attract incremental funds from outside the circle.
2) BTC is closer to the positioning of 'digital gold' as a reserve asset, with relatively stable value and clear expectations, while ETH is essentially a 'productive asset' whose value is tied to multiple factors such as the usage rate of the Ethereum network, gas fee revenue, and ecological development. This means that the volatility and uncertainty of ETH as a reserve asset are greater.
Once the Ethereum ecosystem encounters significant technical security issues, or if regulators put pressure on DeFi, staking, and other functions, the risks and volatility variables ETH faces as a reserve asset could be much greater than those of BTC. Thus, the narrative logic of the BTC version of the micro-strategy can be referenced, but it does not mean that the market pricing and valuation logic can remain consistent.
3) The Ethereum ecosystem has a more mature DeFi infra accumulation and richer narrative extension compared to BTC. Through the staking mechanism, ETH can generate about 3-4% native yield, making it akin to the 'on-chain yield-bearing national debt' of the crypto world.
The institutional Buy-in narrative for this set of stories is a short-term negative for the original construction of various infra like BTC layer 2 that provide native asset yields for BTC. However, in the long term, it is quite the opposite; once ETH plays a greater role as a catalyst for programmable yield-bearing assets in the ETH micro-strategy, it may actually stimulate the BTC ecosystem to develop foundational infra more rapidly.
4) This round of Micro Strategy Summer is essentially a major reshuffling of the narrative orientation of Crypto's past. Originally, project parties built projects and disseminated technology narratives to VCs and retail investors in the market, which, to put it bluntly, were aimed at the native inhabitants of the crypto space. Now, this new narrative, whether it’s RWA or TradiFi, will likely need to tell stories to Wall Street.
The key difference is that Wall Street does not buy into pure concepts; they want PMF—real user growth, revenue models, market size, etc. This forces crypto projects to shift from a 'technology narrative orientation' to a 'business value orientation.' Isn’t this the pressure that competing products like Solana have brought to Ethereum? Ultimately, it has to be faced.
5) This round of micro-strategy concepts on U.S. stocks, including SharpLink Gaming, Bitmine immersion Tech, Bit Digital, BTCS Inc., etc., mostly consist of companies in traditional capital markets facing sluggish business growth who need to integrate Crypto to seek new breakthroughs. Their choice to go all-in on crypto assets often stems from a lack of growth points in their main business, forcing them to seek new value growth engines.
The reason these trading entities dare to be so aggressive is largely because they are exploiting the 'arbitrage window' before the regulatory framework matures, driven by the U.S. government's sweeping promotion of changes in the crypto industry. In the short term, they have evaded many legal and compliance loopholes—such as the ambiguity in accounting standards for classifying crypto assets, lenient SEC disclosure requirements, and the gray areas in tax treatment, among others.
The success of the micro-strategy has largely benefited from the super bull market of BTC, but as a replicator, it may not have the same luck and trading ability. Therefore, the market enthusiasm brought by this trading entity is not fundamentally different from previous pure Crypto native narrative speculation; it is essentially high-stakes gambling and trial and error, and one must remain vigilant about investment risks.
Note: This round of Micro Strategy Summer feels more like a 'big drill' for Crypto entering the mainstream financial system. Success means joy for everyone, while failure is a small joy (after all, any experiment that can drag ETH out of the narrative quagmire is a success, regardless of outcome!).
