The Ethereum (ETH) price has crossed the $3,000 threshold for the first time since April 2022 yesterday. However, amidst the celebratory fireworks in the crypto community, Fred Krueger, a renowned Bitcoin ETF expert, has voiced a starkly contrasting opinion. Krueger, a Wall Street veteran and prop trader, took to X (formerly Twitter) to express his skepticism about the current valuation of ETH, stating, “ETH is completely detached from reality.”

Why Ethereum Is “Completely Detached From Reality”

Krueger’s comments come at a time when the crypto market is witnessing a resurgence in investor interest, with Ethereum at the forefront due to its recent price rally. Despite this, Krueger points out a concerning trend in the usage of the Ethereum blockchain.

ETH is completely detached from reality. A deep dive.
———————————————————

ETH is at $3,000. Surely this must mean that a ton of people are using ETH, and that this number is only going up, right?

Nope.

Eth, the chain has dropped from 120K… pic.twitter.com/141GwtB0yz

— Fred Krueger (@dotkrueger) February 21, 2024

“ETH is at $3,000. Surely this must mean that a ton of people are using ETH, right? Nope. Eth, the chain has dropped from 120K active daily users in 2021, to just 66K over the last year. The top app, Uniswap V3 is only getting 16K DAUs. I remember, back in 2020 this number was 60K or more,” he noted, emphasizing a decline in the platform’s direct utility and engagement.

The Bitcoin ETF expert further criticized the valuation of Ethereum, drawing parallels to meme coins like Shiba Inu due to its inflated market cap, which stands at $361 billion despite the fall in active users. “It really has become a type of meme coin, similar to Shiba Inu,” Krueger remarked, pointing to the stark contrast between Ethereum’s high market cap and its diminishing direct use.

Krueger argues that Ethereum is not only overvalued but also faces stiff competition from other blockchains that outperform it in terms of transaction costs and speed. “It’s not particularly cheap ($1.50 per transaction), or fast. If you are just interested in reward points for games, or casino-style DeFi apps — Solana, Avalanche, Near etc.. all crush it.”

Krueger also expressed skepticism about the future regulatory landscape for Ethereum, particularly concerning the potential for an ETH exchange-traded fund (ETF). “Finally, I don’t think Gensler is going to allow an ETH ETF… I just don’t think Gary wants to make his second ETF a massive pre-mine. Sets a very bad precedent,” he stated, reflecting on the challenges Ethereum faces in gaining mainstream financial acceptance.

The Crypto Community Reacts

In response to Krueger’s critical take, the crypto community on X provided mixed reactions. One user challenged Krueger’s analysis by pointing to Ethereum’s rollup-centric roadmap and the misleading nature of using mainnet daily active users (DAU) as a metric for the platform’s health. Krueger, however, remained unconvinced, stating, “Even L2s like Arbitrum have been in decline for the last 12 months. This is not the case that all is well in ETH-land.”

Another user attempted to highlight the cyclical nature of DeFi and the broader crypto market, suggesting that the current downturn is a temporary phase of risk aversion. Yet, Krueger dismissed these arguments, reiterating his lack of interest in speculative DeFi activities and emphasizing his belief in Bitcoin as the true revolutionary cryptocurrency. “I am not interested in degen ape games. Have fun,” he stated.

Krueger’s critique extends beyond Ethereum to the broader landscape of cryptocurrencies, questioning the long-term viability and value proposition of altcoins, including Layer 1 solutions other than Bitcoin. He argues that these platforms are unlikely to become significant value generators in the long term, likening their control mechanisms to fiat currencies but with central figures like Vitalik Buterin in place of traditional central bankers.

Krueger’s overall stance on Ethereum and the broader crypto market is clear. “My position on ETH. At the end of the day, Bitcoin is the revolution… Every other cryptocurrency is fighting for some other much smaller use case,” he explained, underscoring his belief in Bitcoin’s unique value proposition as a decentralized, finite currency system.

At press time, the ETH price surpassed the 0.5 Fibonacci retracement level (at $2,922), trading at $2,935. A weekly close above this threshold could confirm another leg up for the ETH price.

Featured image created with DALL·E, chart from TradingView.com

Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

An Alaska Airlines flight from Oregon to Southern California made an emergency landing Friday following a mid-air incident in which part of a side of the plane appeared to have detached.

Flight 1282 landed safety at Portland International Airport, Port of Portland spokesperson Allison Ferre said in a statement.

No injuries were reported among the 174 passengers and 6 crew members on board, Alaska Airlines said.

The Federal Aviation Administration said it returned to the airport after “the crew reported a pressurization issue.”

Alaska described what happened as an “incident.” A photo from a passenger on board showed an entire panel missing from a side of the fuselage, next to a row of seats.

It’s not clear how or when the panel became separated from the passenger jet.

On Saturday, the airline said it would temporarily ground all 65 of its 737 Max 9 aircraft while it conducts maintenance and safety inspections.

Kyle Rinker posted a photo from inside the plane on social media platform X, along with the caption, “When the wall of the plane just breaks off mid flight.”

Alaska said in a statement, “The safety of our guests and employees is always our primary priority, so while this type of occurrence is rare, our flight crew was trained and prepared to safely manage the situation.” 

The flight was destined for Ontario International Airport in San Bernardino County, California.

According to FlightAware, an air travel tracking site, the flight took off from Portland at 5:07 p.m. and landed back at Portland at 5:27 p.m.

It identified the aircraft as a Boeing 737 MAX 9.

Boeing said in a statement that it was aware of the incident.

“We are working to gather more information and are in contact with our airline customer,” it said. “A Boeing technical team stands ready to support the investigation.”

The National Transportation Safety Board, FAA and Alaska Airlines all said they were probing the incident.