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This is wrong and reflects a deep misunderstanding of what @ethereum and ETH actually are.
What is the price to earnings ratio of gold? Zero. Nevertheless, gold is the strongest currency of the physical world. Similarly, Ethereum is both a network, comparable in scale to Amazon, and a currency, and it is becoming the largest new institutional layer of the internet.
Ethereum enables true property rights online. ETH is the safest asset to hold within the global digital economy being built on the Ethereum network. In that economy, ETH carries no counterparty risk. This gives it a premium, just as US Treasuries hold a premium in the eurodollar system. I believe many more remarkable products will be built on Ethereum beyond stablecoins, products that will be used by massive numbers of people. The more people use the network, the more ETH becomes its pristine asset.
In ten years, @leanEthereum will be live. It will be to the financial world what MQTT or ZeroMQ is to messaging systems: a universal transport layer for any piece of relevant information that is secure, fast, private, and globally verifiable. In a world where trust is eroding, anything written on the network will be easy to verify. Anyone will be able to connect and validate data, including IoT devices.
The same people who do not understand gold, and are surprised it keeps rising, will be equally surprised when it becomes obvious that all meaningful information will be written to and consumed from Ethereum. You can build banking systems with almost no cost thanks to Ethereum and ETH. ETH will power this system and will be used as collateral across countless products built on the network.
Using price to sales models to understand a currency is wrong. Since I’m young I believed in gold when everyone told me it didn’t make sense to hold it. I believe Ethereum has financial properties of gold plus the ability to be used everywhere like Linux or Google.
I wrote a first post that explains these things. I’m working on a second one that explains why the L1 and the L2 are so important and what things can be built with it and a third one about the technical roadmap I believe Ethereum should follow. You can read more about this in my blog.
Dec 5, 08:44
Amazon is a network and arguably one of the most successful networks ever built. Which is why comparisons are uncomfortable: when you line Ethereum up next to real, scaled networks like Amazon or Facebook, the valuation gap becomes impossible to ignore.
Ethereum at a ~$380B valuation generates roughly ~$1B in annual revenue → 380x sales.
When Amazon carried a similar valuation, it produced $136B in revenue and $2.4B in net income → 2.6x sales.
That means ETH holders today are paying ~146x more per dollar of revenue than Amazon investors did.
The claim that “Amazon is a company, Ethereum is a network” doesn’t resolve the discrepancy:
Networks are priced on the economics they produce: revenue and cash flows.
Amazon’s network effects were real, scaled, and monetizable. And the market valued them on fundamentals, not hypotheticals.
TVL and “assets secured” are not revenue.
Settlement volume is not revenue.
TAM is not revenue.
At some point, you have to put up numbers on the dashboard to support the big narrative talk
@rj_aligned what do you think?
@MikeIppolito_ @ethereum sir @MikeIppolito_ i’m waiting for your answer
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