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Ethereum's Cryptocurrency (ETH); ethereum coin on the background of the chart Shutterstock
Ethereum, the world's second largest cryptocurrency platform, has seen its currency plunge 36% this year, but some important crypto-investors think it has more room to fall, and they are aggressively betting against it 19659004] Tetras Capital based in New York a cryptocurrency fund launched last summer and is known for in-depth analysis of cryptocurrency prices, it has shorted the 39, ether, borrowing coins and hoping The Tetras began to replace the ether in May 2018, when the price ranged from $ 572 to $ 659. Ether currently hovers around $ 470.
week, Tetras has pu published a 41- page report which explains his reasoning. Forbes estimates that the six-person hedge fund has $ 30 million in assets under management. The ether is one of its two high conviction positions, the other is its investment in bitcoins, says founding partner Alex Sunnarborg. & nbsp;
Timothy Young, a former entrepreneur who sold Social Startup for over $ 100 million in 2011, is late with the ether through his family office in San Francisco, Hidden Hand Capital. Hidden Hand has more than $ 100 million in managed cryptographic assets. And the Bay Area Hedge Fund Neural Capital also has a short position, according to a person familiar with the subject.
Ethereum aims to be a global computing platform, but investors like Tetra and Hidden Hand are worried that its $ 48 billion capitalization is not justified, especially because the network can only handle 15 transactions per second. In contrast, Visa can handle 24,000 transactions per second. "Ethereum has an incredible pool of talent developers," says Young. "In the long run, I think they will solve many downsizing challenges, but in the short term, there's a disconnection between the price and the underlying technology." Sunnarborg agrees, saying, "Just because something is a good idea does not mean it's a good investment. "
Ethereum is not controlled by one of a single company and decentralized applications (DApps). None of these apps has more than 5,000 active users on a daily basis, but the network is almost full. Network congestion can make the rates necessary to use the platform rocketed.
For example, to perform a simple transition in the game based on Ethereum CryptoKitties in which users can create digital memorabilia, it could cost $ 3. These costs have risen more than $ 20 at the end of 2017. "An application request can be about 1 million times more expensive on Ethereum than a centralized service like AWS & lsqb; Amazon Web Services & rsqb;," Tetras wrote in his report.
Ethereum developers are working on different solutions to improve network capacity. The Tetras team believes that significant improvements are too far. "The most optimistic estimates suggest that Ethereum & # 39; s Layer-2 and other broad scaling solutions will not be fully functional, tested or able to support the most popular DApps for about two years," reports the "Tetras" report.
Jake Brukhman, founder of Crypto Asset Manager of Brooklyn CoinFund does not agree. He holds the ether since July 2015 and his assets have historically constituted between 20% and 42% of the first fund of his company. Among Ethereum's short-term scalability solutions such as "state channels", which allow transactions to happen more quickly, off the Ethereum blockchain, "a ton of improvements will come on the market this year," he says. Brukhman. "As a blockchain technology, Ethereum still remains the largest ecosystem of technologies, tools and developers."
Some data suggest that few investors are closely monitoring the technological advances of Ethereum. Casper and Plasma are two technical updates that will help accelerate Ethereum transactions. "Casper and Plasma publish their meetings and still have fewer than a few hundred views on YouTube," says Young. "I do not think most people are taking the time or have the technical knowledge to really understand."
Other big-name investors are on the barrier of the ether. Kyle Samani, managing partner of Multicoin Capital says he is "seriously considering" the possibility of shorting it, but he is already betting against ripple and litecoin and is not ready to add a short exposure. The longstanding cryptography investor and CoinShares chief strategy officer Meltem Demirors is "neutral" on the ether. "We are not yet close to a bear market," he says, although he believes the demand for Ethereum-based tokens and applications is largely speculative. "In the absence of further announcements of the Enterprise Ethereum Alliance in 2018, I will not try to add more exposure."
Tetra enters many other reasons for his short film in his report. Recently, other well-funded Ethereum competitors such as EOS, Dfinity and Tezos have arrived online or are planning to launch by the end of the year. "EOS has just raised $ 4 billion and you can pay teams to build applications," says Sunnarborg. "I do not think people with big bags and lsqb; investments & rsqb;
Even the Tetra believe that the ICO boom has pushed up the price of the ether, as many ICOs have accepted only the ether of interested investors.These ICOs are at risk of a regulatory clampdown ", which will wipe out most of the ETH demand," predicts the report.
Sunnarborg believes that the ether would need to become a good value store asset to be at the height of its valuation.It sees the bitcoin as the most likely winner as the main cryptographic asset of the store value, due to "crucial features, including: security , political and architectural centralization, monetary supply, regulation and liquidity, "he says.
What would it take for Tetra to change her mind and get out of her short?" If Vitalik and Vlad left tomorrow and said: & # 39; our sleep abb We have developed the perfect sharding & lsqb; resizing & rsqb; solution, "we could change our opinion," says Sunnarborg.
Or if a regulatory decision gave Ethereum a competitive advantage, for example, if other platforms such as NEO or Dfinity were classified as securities, it would have rethought the position. It does not see the SEC's recent statement that Ethereum is not a security as an indicator of competitive advantage, because the ICOs that launched on Ethereum are still at risk of being considered as securities.
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Ethereum's Cryptocurrency (ETH), ethereum's coin on the background of the chart Shutterstock
Ethereum, the second – the largest cryptocurrency platform in the world, has seen its currency plunge 36% this year, but some important crypto investors think it has more room to fall, and are aggressively betting against it. [19659004] Tetras Capital, based in New York, a cryptocurrency fund that launched last summer and is known for in-depth analysis of cryptocurrency prices, put an end to the ether, borrowing the coins and hoping they will accumulate so that they can buy them back at a lower price.Eether run out in May 2018, when the price ranged from $ 572 to $ 659. Ether currently hovers around $ 470.
Last week, Tetras has public a 41-page report explaining his reasoning. Forbes estimate the six-person hedge fund has $ 30 million in assets under management. The ether is one of its two high conviction positions, the other is its investment in bitcoins, says founding partner Alex Sunnarborg.
Timothy Young, a former entrepreneur who sold Social Startups for over $ 100 million in 2011, is in close contact with the ether through his family office in San Francisco, Hidden Hand Capital. Hidden Hand has more than $ 100 million in managed cryptographic assets. Bay Area Neural Capital's hedge fund also has a short position, according to a person familiar with the issue.
Ethereum intends to be a global computing platform, but investors like Tetras and Hidden Hand fear that the $ 48 billion capitalization is not justified, largely because the network can only handle around 15 transactions per second. In contrast, Visa can handle 24,000 transactions per second. "Ethereum has an incredible pool of talent developers," says Young. "In the long run, I think they will solve many downsizing challenges, but in the short term, there's a disconnection between the price and the underlying technology." Sunnarborg agrees, saying, "Just because something is a good idea does not mean it's a good investment. "
Ethereum is not controlled by one of a single company and decentralized applications (DApps). None of these apps has more than 5,000 active users on a daily basis, but the network is almost full. Network congestion can make the rates necessary to use the platform rocketed.
For example, to make a simple transition to the game based on Ethereum CryptoKitties, where users can create digital memorabilia, it could cost $ 3. These costs have risen more than $ 20 at the end of 2017. "An application call can being about 1 million times more expensive on Ethereum than a centralized service like AWS [Amazon Web Services]"wrote Tetras in his report.
Ethereum developers are working on different solutions to improve network capacity. The Tetras team believes that significant improvements are too far. "The most optimistic estimates suggest that Ethereum & # 39; s Layer-2 and other broad scaling solutions will not be fully functional, tested or able to support the most popular DApps for about two years," reports the "Tetras" report.
Jake Brukhman, founder of CoinFund, Brooklyn-based wealth manager based in Brooklyn, does not agree. He holds the ether since July 2015 and his assets have historically constituted between 20% and 42% of the first fund of his company. Among Ethereum's short-term scalability solutions such as "state channels", which allow transactions to happen more quickly, off the Ethereum blockchain, "a ton of improvements will come on the market this year," he says. Brukhman. "As a blockchain technology, Ethereum still remains the largest ecosystem of technologies, tools and developers."
Some data suggest that few investors are closely monitoring the technological advances of Ethereum. Casper and Plasma are two technical updates that will help accelerate Ethereum transactions. "Casper and Plasma publish their meetings and still have fewer than a few hundred views on YouTube," says Young. "I do not think most people are taking the time or have the technical knowledge to really understand."
Other big-name investors are on the barrier of the ether. Kyle Samani, managing partner of Multicoin Capital, claims to "seriously consider" the possibility of shorting it, but he is already betting against ripple and litecoin and is not ready to add further short-term exposures. The longstanding cryptography investor and CoinShares chief strategy officer Meltem Demirors is "neutral" on the ether. "We are not yet close to a bear market," he says, although he believes the demand for Ethereum-based tokens and applications is largely speculative. "In the absence of further announcements of the Enterprise Ethereum Alliance in 2018, I will not try to add more exposure."
Tetra enters many other reasons for his short film in his report. Recently, other well-funded Ethereum competitors such as EOS, Dfinity and Tezos have arrived online or are planning to launch by the end of the year. "EOS has just raised $ 4 billion and you can pay teams to build applications," says Sunnarborg. "I do not think people with big bags [investments] will let them die."
Tetra also believe that the ICO boom pushed up the price of the ether, as many ICOs accepted only the ether of interested investors. These ICOs are at risk of a regulatory crackdown ", which will wipe out most of the ETH demand," the report expects.
Sunnarborg believes that ether would need to become a good value store asset to be at the height of its valuation. He sees the bitcoin as the most likely winner as the main cryptographic resource of store value, due to "crucial features, including: security, political and architectural centralization, monetary supply, regulation and liquidity," he says.
What would it take for Tetra to change her mind and get out of her short? "If Vitalik and Vlad came out tomorrow and they said," In our sleep we developed the perfect solution of sharding [scaling]"we could change our vision," says Sunnarborg.
Or if a regulatory decision gave Ethereum a competitive edge, for example, if other platforms such as NEO or Dfinity were classified as securities, it would have rethought the position, it does not see the SEC's recent statement that Ethereum is not a security as an indicator of an advantage competitive, because the ICOs that launched on Ethereum are still at risk of being considered as securities.
