Current market depth and ETH thoughts

will paste some personal analysis on ETH...

STFU

Nobody in this board knows what will happen to ETH.

small summary of mispriced risks from the perspective of hodlers and traders.

1) Bubble risk – When your cab driver is telling you to invest in X because X is going to make you rich, you can be sure with 100% certainty the market has reached (at least a local) maximum.

2) Tech risk – BTC succeeded in being the first mover that reached critical mass. ETH has been an innovative fast follower. The cryptotech of the future is likely to be the one that implements all of the incremental tech solutions that BTC & ETH have and will solve. E.g transaction throughput, off-chain txs, fair proof of X, etc.

3) Whale risk – there’s lots of incentive for whales and ICOs to cash out of ETH, fortunes can be made by liquidating today. We saw the impact to the liquidity in the market the last time this happened.

4) Counterparty risk I – people assume the exchanges are as secure as banks and their money is insured etc. Let’s say their right, banks fail too, 2 major ones in Italy last week.

5) Counterparty risk II – the exchanges mostly use automated trading bots, the risk of automated trading strategies blowing up on them is increased with the extreme price volatility.

6) Counterparty risk III – its highly suspicious that the exchanges prevent trading during big price swings, it wreaks of existential risk to the solubility of the underlying business.

7) Protocol risk – ETH is going to switch to Proof of Stake. Might be good, might not be. Either way in healthy markets such fundamental unknowns (risk) would be priced-in (realism), not priced-up (hope).

8) Money supply risk – BTC has a known finite supply. ETH core dev team controls the rate of ETH production (supply), they’re not a central bank, but have the powers of one. Don’t believe me then read up on ICE Age and also the supposedly “deflationary” features of PoS. In any case, this should be a major risk factor over long time horizons.

9) Regulation risk – Many ICO’s can be classified as scams (not maybe, but can by any objective measure) its only a matter of time until regulators step in and the Ethereum Foundation does not have the capacity to comply with a regulators governance framework without a major overhaul… it will have to change and how it will change is an unknown, unknowns increases risk with respect to valuation.

10) Going back to #3 the current market depth on ETH could be eaten entirely by any of the major recent ICOs or whales... there's only some many times people will fall for trading back up to the pre-crash price.

tldr; be careful when picking pennies in front of steam rollers.

What's the safer option then?

Didn't say there was one, just pointed out how most folks don't understand risk.

sell just enough to get your initial investment back, maybe a couple of grands extra

let the rest sit for a couple of years

peace of mind is bliss, tbqh, sure your potential reward will be less, but you wont be losing anything if it crashes and burns

tbqh, im taking my initial investment back if eth hits 800$+

Tl;dr Eth is a mess

I enjoyed this analysis

Thanks. I read these and immediately felt better about a recent buy.