SharpLink Gaming, currently the largest player in the Ether treasury strategy space, saw its share price surge over 28% yesterday following news that it’d accumulated 7,689 ETH over the previous week.
Ethereum co-founder and Consensys CEO, Joe Lubin, has told NBC’s Squawk Box that companies accumulating Ether — aka Ether treasury strategies — will be critical to creating profitable supply and demand dynamics for the cryptocurrency.
Asked about the rationale behind the Ether treasury strategies of companies like SharpLink Gaming (he’s currently its Board Chairman) Lubin said it was primarily about showing Wall Street types that accumulating Ether can be good for business: “It’s about telling the Ethereum story — what does Wall Street pay attention to? It pays attention to being able to make money.”
Lubin added that by accumulating Ether and locking it up in corporate treasuries, these strategies also help to absorb excess Ether and create upwards price pressure.
We still have a lot of Ether out there and not enough activity to sop it up and so that’s a reason we and others are doing the Ether treasury strategies. Not only is it a great business to run, but it is going to be critical to enable the supply / demand dynamics of Ether to right-size as we build more and more applications.
Joe Lubin, Ethereum co-founder The strategy seems to be creating some buzz. SharpLink Gaming stock rose an impressive 28.57% on July 8 following news earlier the same day that it had accumulated 7,689 ETH during the week of June 28 to July 4 at a cost of US$19.2 million (AU$29.4m). Its stock price is now sitting at US$16.29 (AU$25).
SharpLink Gaming is currently the largest player in the Ether treasury strategy space. But Lubin said he’s positive about more “complementary competitors” adopting a similar strategy.
“So we’re at this point the biggest — we’re making the biggest splash…We look forward to welcoming other competitors, complementary competitors, into the space and even collaborating with them.”
Related: SharpLink Bets Big on Ethereum With US$463M Buy, Becomes No. 2 Holder
Lubin suggested Ether’s weak price action against Bitcoin over the past several years was partly due to weak narratives — something he believes Ether treasury strategies can address.
So Bitcoin has had a very clear narrative and it’s got a value proposition people can understand and get behind. Michael Saylor’s been doing a really good job growing the brand and buying lots of Bitcoin. So, Bitcoin’s value proposition is now. Ethereum’s value proposition has been perceived to be in the future.
Joe Lubin, Ethereum co-founder Lubin also argued that Ether had been much more impacted by the regulatory stance of the Securities and Exchange Commission under former Chair Gary Gensler than Bitcoin had been.
“We’ve been building scaling infrastructure, layers of enabling infrastructure, for about a decade, anticipating that all the activity of the internet and the web will move to web3…But we haven’t had the applications and we haven’t had the consumer end users, or the enterprise end users, because former [SEC] Chair Gensler made it very unattractive to use tokens or issue tokens or build applications in our ecosystem. So, that is all behind us.”
Related: Scaramucci: Corporate Crypto Treasury Craze Is Just a Fad
With Gensler’s reign of terror now just a bad memory and a much more pro-crypto regulatory environment in the US, Lubin believes the stage is set for strong growth for Ether and digital assets more generally.
Because decentralisation is the direction of travel for the world, we believe we’re going to see Bitcoin and Ether continue to rise over the next years and decades as we paradigm shift to more and more decentralisation. So that’s going to put a bid under these tokens.
Joe Lubin, Ethereum co-founder