Bitcoin as digital gold and what Ethereum is

Transcript

when I think of the Internet it's like there's so many things that the internet changed and there's so many on liners of what the internet could be depending on who the person is and I think that's a feature to me that's why the flipping will occur it's why one day ethereum will be bigger than Bitcoin GM good morning welcome to the milk Road show The Daily crypto show that's as electrifying as a sip of sprite from McDonald's I'm your host Jay Hamilton and the EF is live in the US and in the first 90 minutes or maybe the first two hours at this point it's done 600 million in volume is on Pace for approximately 1 billion in day one so this week is eth week we've got episodes all week to build your Investments

thesis for eth so you can confidently explain to your wife or your husband why eth is one of the largest Holdings in your portfolio here to guide us today is milroad co-owner Kyle rehead who first bought eth at50 oh I wish I bought a lot more at that time but it's going to be back on the show I feel like it's been a minute I miss you guys it's good to have you back Kai it's good to have you back and I'm sure our listeners are happy as well okay Kai the EF went live for trading this morning in the US what's your reaction to what has happened so far yeah so so far about halfway through the trading day we're at about 600 million in volume which is about 20% of what Bitcoin did in its its full day or or

will be if we we continue on that which um interestingly is what the Bloomberg boys had uh had guessed we get about 20% in terms of the flows like I honestly don't really know early on what I think's going to happen here one this is super exciting so I'm super pumped it's eth day that's what I got up and said this morning or eth week I think what happens here is it gets anyone's guess right we obviously have a bunch of capital that needs to come out of grayscale which is like a 2.5% fee or something ridiculous and then we'll see what happens if people are interested in eth ETC the way it worked with Bitcoin was in the first two days eth was down 8% and and then I think in the first two weeks it bottomed out at around 20% and then it went up 90% from there over the

next couple months so could the same thing happen with eth I don't know potentially currently we're down a little bit on the day it has been just kind of like a we were up for a little bit and then I think I'm just checking right now yeah we're sitting around 3,400 so you know down like half a percent so you know nothing too exciting nothing too crazy markets are a little bit different than what they were back in February or January whenever it was the Bitcoin ETF launched so we'll see I I'm not really like too overthinking it I'm just kind of chilling I've got my eth as you said bought it first at 150 I didn't buy a lot of it then but I bought a few at 150 bucks but I've just been continuing to buy and I think we're getting to the stage where we're about

to be at the last chance to be buying at good prices whether it's in the first week of this ETF or it's a few weeks to months doesn't really matter but all the things are kind of lining up both with the ETF and then macro and Etc and I think all that's lining up to a very bullish next few months to probably about a year and so don't really care what happens over the next few days two weeks it's love that P love that perspective that's the that's the long-term investment perspective that we expect from our head of research at milroad Pro Kai with the ethereum ETF going live many have been asking the question what is eth if Bitcoin is digital gold then what's eth is there a simple one liner for eth like there is for

BTC you know that Meme where there's like the girlfriend and the boyfriend the husband and wife are like laying in bed together and she's like oh he's cheating on me or he's thinking about this girl or whatever and then he's like trying to do a a math equation or something I feel like oftentimes at night this is what I'm thinking about I like what is e how do I in one sentence and I I honestly can't and I think it's interesting there's a bunch of ways to explain eth and you'll see a bunch going out some of the commercials coming out from some of the eth ETF providers have come out recently and they're taking different angles right and it's because eth does so many things and so to try and bring that into like one thing is not so easy it's kind of like the internet right like in the

90s how could you come up with a oneliner for the internet it meant so many things and even today it means so many things and so it's it depends on who you're talking to on what that oneliner should be if it's a finance person who works in Banks or has worked in any sort of financial service then maybe it's always on finance right 247 Finance because that's what eth provides right right now Finance takes the break on weekends and on you know weekday evenings and just shuts down whether that's stocks or that's sending money or that's accessing your bank accounts often times it just closes right whereas ethereum allows Financial Services the same as what we're used to but 247 so like there is one oneliner three words 247 Finance there's one way to say it but that doesn't make sense to like

everyone because there's a lot of people around the world that don't have Banks and they don't ever invest in stocks and so like to them they're like I don't know what you're talking about right so then there's also like the decentralized app store right this is very easy for people to understand if you've ever played anything on Apple or on Google Play Store whether that's using social apps or using banking apps or using anything games you know there's a centralized app store which is Apple Google Play and there's the decentralized one which is eth and so there's a way more for tech people not Finance people to sort of wrap their heads around what ethereum is again ethereum does both of those and it does them really well so there's an option there some of the others the settlement layer of the internet this one again

doesn't make sense to everyone but if you think about the way the internet was built is it wasn't built with a settlement layer it wasn't built with finances in mind when they built the internet they didn't realize that we were going to actually use credit cards and put money in a digital format all of a sudden now that's happening and so what we've done is taken these old school rails in the like normal Financial World plugged it into the internet and it works but it doesn't work that great right uh it's slow The Settle time not fast whereas like everything on the internet is like immediate right and cheap and it's so it's very clunky to add the like physical Financial rails to the internet and so the ethereum is sort of the settlement layer for the internet right it is adding that Financial layer that

didn't originally exists so there's that one some people get that not everyone will get that the original one was like the world computer I don't really love that one that one doesn't make sense to like anyone I feel like especially not me but maybe a lot of nerds will get it because it's basically taking Computer Resources and distributing across the world and then there's like ultra sound money this is more of like what is eth the asset not what is ethereum the blockchain so if Bitcoin is digital gold and it's what you would call sound money this is what you would call gold right because it has a very low or no inflation rate you know Bitcoin has 21 million well eth has you know a deflationary toonomic structure so it's even technically if you think about it that way could be better than Bitcoin

and so instead of sound money which is Bitcoin ethereum or eth is ultrasound money now that one's kind of getting Meed into existence on the internet but not everyone loves that one too so like you know you can choose so many different ones and I think it just depends on who is your target market and so like ethereum ETFs some of them their target market is like institutions and so they'll go the 247 or you know always on finance route right but that might not make sense to the Silicon Valley people and so you might need to say the decentralized App Store to those people so like I think it's going to be marketed in many different ways whereas Bitcoin is kind of like just digital gold that's it you know so it is simple and that's great but ethereum's just so many things I want to get into in a

minute if it's a feature or a bug that there are so many different on liners and ways to Define ethereum as well as some portfolio allocations and price predictions on your end but first one of the most common that I've seen across the internet is digital oil why didn't you include that in your list um also an older one it does sort of work digital oil the the sort of reference there is like for the global economy to work you need oil basically to do everything right whether you want to produce Goods you want to transport Goods like oil is a part of everything it's priced into everything that we do in the in the world at least currently uh that may change over time but oil really is that and so eth because it's gas right to

transact on ethereum is kind of similar to that also a a a good way to sort of explain it I guess to some people people that think of economics and think of the global economy they might understand it that way but you know most people in the world aren't really thinking about when they buy a a cup or they buy a water bottle like there's oil prices priced into that so like I don't know it works again for some people and and not for others so it's a good one I just I don't know there's so many I could continue on we could do 10 more if you want no we like we like Simplicity here the Milkman doesn't need 15 different answers that's that's going to be your next question as you said right Simplicity digital gold is is what Bitcoin is exactly and so is

that a problem for e the if ethereum is going to gain Mass adoption from an investment perspective not from a blockchain usage perspective but from all these new people that are seeing these incredible ads that are going out by coinbase and bitwise and we want them to go buy ethereum well they buy Bitcoin because they're like oh digital gold I get that right away is this a problem for ethereum honestly maybe in the short term it's so easy to wrap your head around Bitcoin right and most people myself included probably you as well Jay they came into the space going okay I see what Bitcoin is that makes sense ethereum takes longer to wrap your head around once you do you're like whoa mind blown this is way bigger than I thought it was even once you understand Bitcoin you're like whoa this is really big but

then once you understand ethereum or smart contract Platforms in general doesn't necessarily have to be ethereum you're like whoa this is not just money this is like everything right so it is nice to have just like a oneliner especially like any business you think like one of the things that investors always want you to do is like what's your elevator pitch and you need to have that thing figured out when someone asks me like what crypto or ask what is bitcoin or what is ethereum and it's like I don't know my like Mom or something like I like being able to explain that Bitcoin is pretty simple to explain and then when they want me to explain ethereum I'm like okay how can I explain this one right so like definitely in the short term it is probably a a feature to be so simple

like Bitcoin though like I question how many people even really understand the intrinsic value of gold to be honest like that's more of a boomer old school thing most gen Z Jens whatever don't really understand that anyway so like is it really that great I think in the long run the not being s simple here and having so many different storylines or sort of like on liners is actually a feature uh and it is better because it means there's just so many more things that you can do on it right A lot of people understand why stable coins are important it's easy to wrap your head around well that exists on ethereum a lot of people understand why a decentralized App Store Mak sense and so that all happens on ethereum a lot of people understand why finances and financial services should be decentralized okay well that's all in

ethereum so like there's different stories for different people all around the world and so your total addressable Market is so much bigger with ethereum yes the whole world could hold on to bitcoin but like most of the world doesn't really need it it's not like a burning issue for them but like a lot of people do really need stable coins right now right and a lot of people do need financial services right now and so it's like there's just more things that and when gaming comes out and when all these other things come come to into fruition like there's just so much more and so when I think of the Internet it's like there's so many things that the internet Chang and there's so many on liners of what the internet could be depending who the person is and I think that's a feature I think it mean that's that to

me that's why the flipping will occur it's why one day ethereum will be bigger than Bitcoin or if it's not ethereum why smart contract Platforms in general will be much bigger than what Bitcoin will be I don't know if it's necessar ethereum but right now it's the obvious leader but we'll see also as you said investing in ethereum now is similar to investing in the internet back in the 90s when nobody really knew what it was yet is that an edge and an opportunity that you see yeah that's a great point I mean the other the thing here is like we all know what Bitcoin is and so it's worth one point whatever5 trillion dollar right because once something becomes very easy to wrap your head around and you know

and it's useful and it's easy to understand and people know about it then okay you don't really have the upside anymore or you have less upside when you have something as revolutionary as ethereum and yet people still don't really get it even though it is so massive it's going to impact everyone but they don't understand why like the internet in the 90s that's the time of investing it's like you could invest in the internet and internet companies now and that's good but it's not as good as if you invest in Amazon and Google and all them back in like 1995 or 2000 whenever they launched right obviously it's way better then because most people didn't understand how much the internet was going to impact the world and impact their everyday lives the same is true right now in ethereum right and so sometimes when it's hard to explain

something that's actually better if it's actually something that's going to revolutionize the world which I think ethereum will the other point that's sort of within what you just said is you're talking about investing in Amazon for example that's a app that's built on top of the internet obviously picking the apps that are going to achieve Mass chain Mass adoption on chain is very difficult very had you had the opportunity to just invest in the base layer of the internet that is aasy so obvious no-brainer so you have that opportunity with ethereum right now right in front of you and that is exactly which is another narrative for a theorum which is hey if you think crypto is cool and you think crypto is

the next big thing you can just buy ethereum because it's all built on there right it is the ETF of crypto and so for people that even understand farther down the the you know rabbit hole it's easy to explain why ethereum is a good investment just because of that so it's a great point just to touch on the bear case for a second I always want to make sure we have a balanced view for our listeners here what is the the when we say that the future of onchain is going to be built on ethereum what's the risk that ethereum isn't I guess there's two risks one that onchain just doesn't go or that ethereum is not the chain that all smart contracts are built upon yeah I I think we're past the point that on Chain's not

going to be a thing right we have sort of proog Market fit and inflection points that we've already kind of taken off and so like you can't really put what's it called the Rabb it back in the Hat or whatever can't really do that anymore with things like stable coins probably what poly Market has just done obviously what what Bitcoin has done so like there's a lot of things I think just like we're not going back so I don't see that so much as a risk I do think obviously who's going to be the chain that people use what apps are going to build on we don't know that one yet we don't really know how that's going to work because it's still just so new and so I would say that's the biggest risk although I I Put A Min a small risk on that I think there's

definitely a risk there not even a risk I would say I think there's definitely a lot of room for other smart contract platforms to catch up to ethereum something like salana um we think that's undervalued versus eth but I think there's still plenty of room for ethereum to grow because we've barely even tapped the the market yet so I would say like yeah others will come and they'll fight with ethereum and they'll compete with ethereum and they'll gain market share on ethereum but like the pie is going to grow so much bigger we're not fighting for a piece of the pie it's we're all just growing the pie at the moment so like Risk is I don't know I don't hold a ton of risk there great yeah when markets are going well as they are at least in the past week which is great to see portfolio

allocation becomes very difficult it's tough to know which assets you should be in how much of your portfolio is in eth and how should people be thinking about portfolio allocation with regards to eth yeah great question I think I get qu this question asked every single day in our Pro Discord on Twitter Etc is like how much should I allocate to how should I set up my portfol and so this brings up a great a great time for this but we actually just created a course at milk road called the crypto investing Master Class how to profit from the future and it teaches exactly this because I'll give you my answer in two seconds but that answer is going to change in three months from now and six months from now in 12 months from now and so if you are an investor and you don't want to be gambling in

this space meaning just guessing and you want to actually invest meaning know what you're doing know what you're investing in understand how to create your portfolio and manage your portfolio and change it based off Cycles Etc then you that's what this course is for that we created so I actually just recorded this a couple weeks ago it's like five or six hours of cour work it's a full master class on how to invest in crypto and it teaches everything from understanding the cycles of crypto understanding how to Value an asset is it overvalued or undervalued and understanding how to manage your portfolio and so when you see there's an opportunity here like ethereum and you're like how do I allocate what is the risk reward here how should I do this this course is going to teach you exactly that so I'll give you the answer

of what I'm doing right now but if you really really want to how to play markets and you want to capitalize on this cycle and the long-term coming Cycles I highly highly recommend you take this course right now I think we have a discount for everyone at like 30% or something right now 33% 33% 33% if you're a pro member you get 50% off so either go and sign up for pro if you're not already and then get the 50% off or you know do whatever you want but I'm telling you right now that like the question that Jay just asked me I spend six hours basically answering everything about that for the entire crypto space inside this course so if you really want to capitalize on this Market just go do that and do not wait to take it because if you wait a few more months you're

going to be late so I highly recommend you take this now plus you get a massive discount anyway let me answer this question for you the question is how much of it is in my portfolio Okay eth makes up about 50% of my portfolio currently it was actually much more when I allocated which I've been allocating through the sort of bare Market of of 2022 in 2023 and so it was actually much more but I allocated heavily to salana as well and soul has obviously done a lot better than basically any other asset and so that has actually creeped up and is now a big big portion of my portfolio as well regardless the majors make up more than 80% of my portfolio probably closer to 90 90% maybe 95% a little different than what the milk Road Pro portfolio is and most of that is is Ethan soul and uh and then

the rest are like some smaller plays some beta plays on ethereum some beta plays on salana is basically the the two ecosystems that I that I allocate to I just want to talk a little bit about those B data plays how do you think about investing in ethereum versus investing in other parts of its ecosystem whether it be the l2s or whether it be apps built in ethereum yeah I've mainly been in Ethan soul for a while and I think we're getting to this sort of more risk-on phase of the market once we sort of get our next leg up so I think altcoins will will start to have their moment and so I see more opportunity now in the eth OR Soul beta plays than I did like in last like year which is why I've been promoting so much

like just get eth get Soul it's so much easier to just like manage especially if you're not in this every day in terms of like alts I don't even invest in many because it's hard to build conviction in many so like I find I think eth and soul are just such good investment opportunities I really struggle to like let go of any of that which is why like just a couple percent of my portfolio is in anything other than Ethan Soul the way I look at it is I go well if eth is going to let's say I don't know 3 four 5x whatever it is or soul is going to do that which applications are going to benefit the most from when that happens so when eth goes from a currently $400 billion market cap to a one point whatever5 trillion doll market cap worth

you know 10 15K who's going to benefit from that and I look and I think like well maker Athena Lio like the ones that their revenues revolve around the price of eth and their tvls revolve around the price of eth they are most likely to do the best because even if they get no more new users and no more Capital their revenues 3 four 5x just because the price of e 3 four 5x is right and so generally though when if eth is going to go up 3 four 5x it's amount of users and the capital coming in the space is going to also go up massively and so these are more like your leverage plays where if eth Goes Up 3 to 5x their revenues probably go up more than 3 to 5x right

because you have that additional benefit of more users coming in more Capital coming in ETC so that's the way I think about it and I look for plays that can sort of capitalize on that so that's that's mainly what I'm looking for final question and you just kind of actually already answered this what's your price target for eth in this cycle it's it's um it's so tough like my range is so big it's like anywhere between 10 and 20K what I really look at and and what I think people should be thinking about rather than what is the top price is like where does it end up after it after this cycle right because we know it's going to hit a top point at some point and then it's going to come back how how far is it going to come back that's what I'm trying to think of like where is it

going to range for a while like we've been in this like 2 to 3,000 you know range for like almost a year two years now that's the number that matters we hit 5,000 or close to 5,000 last cycle for like a day right and then it went down like 50% or whatever pretty damn quickly so like that 5,000 is actually really irrelevant no one sold at that or one person did they were very lucky revenues of apps that are building on it doesn't matter that eth hit 5,000 because they didn't actually gain any benefit from that because really month over month over month the revenues came when eth was more at like 3,000 or 4,000 whatever right so like I worry a little bit less about what's the peak and I kind of think of like after that Peak where do we sort of like level off you

know and so for me maybe we Peak somewhere around the 10 to to 20K if things really get a bit crazy and then it's this like 8 to 10K is where I think is the more like fair value of eth in the next 12 18 months kind of thing all those numbers sound pretty good to me Kai I like your predictions for sure uh thanks so much for joining us again today and just one more time I want to mention the course that has just launched that is the crypto investing Master Class an opportunity to profit from the future all about understanding the flow of the market picking winners how much eth should be in your portfolio what else should be in your portfolio how do you build a portfolio for long-term success and as we said earlier because you're a loyal listener of the

milk Road show you get a massive 33% early bird discount right now now this offer is only good until July 28th so make sure you hit the link in the show notes and sign up or if you want you could go pro and get a 50% discount off the course so decide how you want to play it Kai thanks so much for joining us again today hey happy to be here I hope everyone's celebrating eth ETF day let's go eth day it is hope you have a wicked awesome day everybody thank you for listening to milk Road radio the easiest path to get smarter about crypto if you like this episode share it and hit subscribe or follow so you don't miss out on the next one there's also a link in the description to our free 5minute daily newsletter where we

simplify crypto for you while making you laugh and if you're willing to step up your crypto investing game then we'll leave a link to milk Road Pro as well your number one resource to help you invest successfully in crypto one final note this podcast is for educational purposes only and nothing we say is financial advice crypto is risky so you should never invest more than you're willing to to lose thank you friends and we'll see you in the next one