One of the reasons strategist and investment guru Lyn Alden doesn’t invest in Ether is that she views the Ethereum network as an “unfinished product” compared to Bitcoin.
Alden’s economic analysis of Ethereum has been released today compares the smart contract network to the Concorde jet: functional because it has “a lot of smart developers working on it,” but unlikely to be an economically sustainable project in the long run. She has brushed aside some of the key features of Ethereum as evidence of her claim, calling the use case of many decentralized apps “circular and speculative”.
In addition, she said that the network’s nodes are more likely to receive a centralized attack “if government action was taken against third-party node services.” Alden said regulators would not “necessarily bring down Ethereum,” but could effectively threaten the use case by making the apps more difficult to run.
Alden summarized her thoughts on Twitter:
“Ethereum could indeed perform very well in terms of price next year, but as long as it transforms its base layer, it will remain a speculation in alpha development, rather than a finished / stable product.”
On the other hand, the investment guru said that Bitcoin (BTC), with his fixed offer of 21 million coins, did not have Ethereum’s “arbitrary monetary policy” in addition to the fact that there was a “cultural gap” between the two networks.
“Ethereum attracts more of a gamer culture and more experimentation,” said Alden, noting that some of the projects built on the network had failed. “Maybe in another 5 years, when Ethereum 2.0 is in place for a while and functioning for a while, with a consistent monetary policy for the whole time, it can be considered largely a completed project like Bitcoin. Until then it’s experimental. “
Last year, Alden said she was getting “pretty optimistic” about Bitcoin given its scarcity, halving, and potential of the crypto asset to act as a backdrop to inflation. She added in her analysis of Ethereum that she preferred Bitcoin for its ‘risk / reward opportunity’ and claimed that despite the currency’s price volatility, there was ‘upside potential’.
“[Bitcoin] doesn’t move fast and breaks things like many altcoins do, but it moves slowly and tends to do things right, ”she said. “The more ideas and innovations that emerge in the broader digital asset industry, the more Bitcoin developers have to work for their protocol and ecosystem.”