Ethereum co-founder Vitalik Buterin expressed support for the growing trend of companies buying Ether while cautioning against potential negative consequences.
Growth of Ether Treasury Companies
In a recent interview with the Bankless podcast, Buterin noted the significance of the growing number of public companies purchasing and holding Ether. He stated that this trend opens the token to a broader audience of investors. "There’s definitely valuable services that are being provided," Buterin said, adding that such companies offer more options for different financial circumstances.
Warning Against Over-Leverage
Despite his support, Buterin cautioned against excessive leverage. He expressed concerns that if situations lead to harm for ETH, it could have negative repercussions for the market. Specifically, Buterin remarked: "If you woke me up three years from now and told me that treasuries led to the downfall of ETH, my guess for why would basically be that somehow they turned it into an overleveraged game."
Market and Current ETH Situation
The current market for Ether treasury firms has ballooned to $11.77 billion, highlighting the importance of this sector. Leading companies like BitMine Immersion Technologies and SharpLink Gaming hold significant amounts of ETH, and the overall value of assets holding Ether continues to rise. In addition, ETH has shown volatility, rallying 163% from its April low and currently priced at $3,870.
Vitalik Buterin's support for Ether treasury companies emphasizes their potential value for investors. However, his cautionary notes about the risks of over-leverage remind market participants of the need for a careful approach.
