Co-CEO of Sharplink Gaming Joseph Chalom has expressed concerns about the heightened risks for companies trying to maximize yields from their Ether assets.
Assessment of Investment Risks in Ether
According to Chalom, companies that buy and hold Ether to maximize yield face significant risks if the market declines. He explained that while there are ways to achieve double-digit yields on Ether, these methods come with substantial risks, such as credit risk, counterparty risk, duration risk, and smart contract risk.
Thoughtless Actions Could Harm the Industry
Chalom pointed out that the industry could be harmed by thoughtless actions from market participants trying to increase their profits amid instability. He clarified that over-investing during market downturns could lead to severe consequences for companies.
Discussion on the Cryptocurrency Treasury Model
Josip Rupena, CEO of the lending platform Milo, highlighted similarities between cryptocurrency treasury firms and collateralized debt obligations, which could lead to consequences similar to those of the 2008 financial crisis. However, according to Matt Hougan of Bitwise, such companies help to solve the problem of Ethereum's perception as an asset.
Overall, expert opinions indicate substantial risks for companies working with Ether and warn against thoughtless decisions that could negatively affect the entire industry.
