Optimistic about $ETH's Core

Many people believe that ETH is inflationary because stakers can earn newly issued coins. But I don't see it that way; in fact, ETH is fundamentally deflationary, or even strongly deflationary.

Why? Because the issuance of ETH is not a free gift to any institution; as long as you hold the coins, you can stake them and earn rewards yourself. The staking return rate is generally greater than or equal to the inflation rate of ETH, meaning that as long as you participate in staking, your overall coins are 'outpacing' the issuance rate.

Moreover, a portion of ETH is burned with each transaction, further reducing the supply. So sometimes, ETH is in a net deflationary state.

By the way, this mechanism is somewhat similar to earning interest by buying US Treasury bonds with US dollars.

Based on this logic, ETH actually has the potential to become a stronger store of value than BTC. In the future, as market understanding deepens, there might be:

More and more people buying ETH → Staking rate increases → Dapp ecosystem explodes → Burning intensifies → Forming a super strong flywheel.

As for the field of smart contracts, currently, new public chains like Solana and Sui are indeed more flexible in scenarios like chain games and social applications where security requirements are not as high. But ETH is not incapable of efficiency; it has deliberately chosen a safer and more decentralized path.

In my view, the most important aspects of smart contracts are security and stability. If you only want performance, you might as well use Web2 directly.

At present, no other public chain can surpass the degree of decentralization of ETH. In the future, it doesn’t necessarily have to compete with new public chains for end-user customers; taking a B-end approach with financial core + L2 infrastructure also has great imaginative space. Personally, I am very optimistic about ETH; just give ETH a little more time and also give yourself a little time.