English
72652
|
My thoughts after watching: (The following content is for reference only and is not intended as any investment advice. Please be responsible for your own investment behavior) 1. An emotional, deep and rational introduction to Ethereum statement: This article is a study and compilation of public video materials The first half is a personal summary, and the second half is attached with a verbatim draft for easy learning and reference. The copyright of the video belongs to the original author, and this article is for learning and communication only. Original author: Brother Nao Chill Blockchain original video release time: October 1, 2025
The Origin and Founder of Ethereum
Ethereum’s technological innovation
Ethereum’s early challenges
Market development and cycles
The current situation and future of Ethereum
ETH Token Economic Model
Investment potential and riskspotential
risk
The video summarizes the development history of Ethereum from its creation to the present, analyzes its technological innovation, market position and investment prospects, and emphasizes Ethereum's leadership in the blockchain 2.0 era and its core role in the wave of asset tokenization. Verbatim transcript of the original video (for learning reference only) The following is a verbatim transcript of the video: Maybe you haven't discovered it yet. But this, perhaps the most important financial revolution of this century, has quietly begun. Understand Ethereum at once. Since the advent of Ethereum in 2015, every time the currency circle appears on the front page of the news, it is inseparable from it. ICO, NFT, metaverse. Even Play to Earn is a trend of playing games, walking and making money. They all come from the Ethereum ecosystem and the on-chain community dominated by retail investors. But things will be different in 2025. Wall Street giants began to hoard cryptocurrencies, including BlackRock, Fidelity, and Bridgewater. Even U.S. President Trump’s own family’s companies are beginning to be optimistic about the blockchain track. Ethereum has once again become the focus of attention. But what people are talking about this time is not just making money in a small way for a few years. But how to move the entire Wall Street and the entire dollar system to the blockchain. They were talking about a radical revolution in finance. And the person taking the lead is not a young B-god from somewhere, but the top asset management company on Wall Street today, BlackRock. Today we will fully introduce to you Ethereum, this illusory thing that may be rewriting financial history. What Wall Street values most. What retail investors need to pay attention to most. The highlights and dark history along the way, and most importantly, the potential and risks of ETH investment, will be told to you all at once. The story of Ethereum begins with its founder, Vitalik Buterin, one of the most influential developers in the entire currency circle. Vitalik was born in Russia in 1994. Just like Musk and Bill Gates, these geniuses who created the era. Vitalik's talent and enthusiasm for technology have been evident since he was a child. When he was 4 years old, Vitalik received his first computer from his father. Guess what was his favorite game at the time? Not pinball, not Solitaire, but Excel, or use Excel to write VBA. At the age of 6, Vitalik was able to recite pi to 20 decimal digits. When he was 7 years old, he developed a small game using Excel. Even at the age of 10, I have already mastered the C++ language, which many students in the engineering department find difficult. At a time when his peers might not even be able to play computer games well, he had already begun to write his own games. Vitalik’s story reminds me of Tesla CEO Elon Musk, who also developed a game called Blaster at the age of 12 and sold it for $500. These world-changing geniuses are really different from us. When he was 16 years old, Vitalik, who was in high school at the time, encountered the first spark that ignited his entrepreneurial journey in the cryptocurrency industry. It was really pure and innocent to say the least. At that time, Vitalik loved playing an online game called World of Warcraft. He especially liked playing the role of Warlock. As a result, Blizzard, the developer of Warcraft, weakened the Warlock's signature skill Soul Siphon in a certain update. We all have experienced our favorite characters being weakened. Usually we just feel uncomfortable and get used to it, or at worst we can practice in another role. Normal people know that this is the right of game companies. They wrote the game and the world view is determined by them. Even if you are not satisfied, you have no choice. But Vitalik is obviously not a normal person. Vitalik realized that the roles and accounts that many users have worked hard to create in the virtual world, as well as the accumulated skills and assets, etc., would have to face the unilateral decision of a company at any time. It has to be obliterated without any suspense. This situation that has to be controlled by a centralized entity is called abnormal. He even cried himself to sleep that night because of this. If you were next to Vitalik that day, you might think that he just needs to practice more. These are the rules of online games. If you don't like it, don't play. But today, more and more people are indeed dissatisfied with such a centralized control system. For example, you must have heard of some IG accounts that have never done anything, but Meta officials said they were frauds and froze their accounts. You must have friends or even yourself, and your bank will tell you that your cash flow is abnormal even though you have done nothing. Even if you submit any proof, your account will still be frozen. In the era of Web 2.0, although the rapid development of the Internet has brought about economic prosperity, it is almost like an unspoken rule to hand over your control to the platform. I agree to the privacy terms and have read the information security instructions in detail. However, it has inevitably expanded the imbalance of rights between the centralized platform and users. Until one day, it's no longer "inevitable." Bitcoin is great, but not good enough. If the soul siphon incident planted the seed of decentralization for little Vitalik, Bitcoin brought him irrigation. Vitalik was first exposed to Bitcoin in 2011 at the University of Waterloo. Most people may be excited about the price of Bitcoin, but Vitalik is fascinated by his combination of decentralized concepts and cryptography. At that time, Vitalik was still a poor student. He had no money to build a mining machine or invest directly. So he first worked as a research assistant next to cryptography professor Ian Goldberg, while helping to make money by writing articles for Bitcoin Weekly. As he wrote, he strengthened his belief in Bitcoin and jumped out to create Bitcoin magazine. On the one hand, he also found that the decentralized, permissionless, free and private attributes of the Bitcoin blockchain, although fascinating, But there is a huge shortcoming. Insufficient functionality and scalability. We all know that Bitcoin and blockchain are two concepts that exist in parallel but are not the same. Bitcoin is that digital asset that runs on a blockchain, its underlying system. The problem with the Bitcoin chain is that although its decentralization properties are perfect, it has no way to carry any other digital assets except Bitcoin. For example, your game virtual treasure, game account number, Taiwan dollars and US dollars in your bank account, your tickets or other certificates, At that time, many blockchain engineers tried their best to develop different applications on the Bitcoin blockchain, but in the end they all came to nothing. At the same time, there is also another group of engineers who want to take advantage of Bitcoin’s blockchain technology. Develop a new blockchain specifically for decentralized versions, DNS identity systems and other applications, etc. But most also failed. What Vitalik thinks of is that essentially, we are going to create decentralized versions of various centralized assets and platforms on the Internet. So instead of building a chain for each asset, is it possible that we only need one chain, which does not need to be specifically designed for a certain function, but can allow any function to occur. Just like the iOS or Android operating system in our mobile phones, the operating system itself has no functions. But developers can build any function on it. You can have online banking apps, social networking apps, finance, games, audio and video, and learning apps. If we had a blockchain that allowed all this to happen, At the same time, all users’ information, data, and assets can be decentralized like Bitcoin. Wouldn't it be very interesting. Vitalik Buterin was only 19 years old at the time. In a paper he wrote, he proposed this idea. The blockchain imagined in this paper pays tribute to a basic element in the universe proposed by the Greek philosopher Aristotle. Its name is Ether. And this blockchain is called Ethereum. Blockchain 2.0 revolution. As soon as the Ethereum white paper was published in November 2013, it caused Luoyang Zhigui in the blockchain circle. Not only does Vitalik have grand ideals, he also proposes unique innovations on the technical side. Vitalik explains for the first time a blockchain on which smart contracts can be developed. The introduction of smart contracts allows a blockchain node, like a technology company's server, to store and run various complex codes. Such a blockchain, such as Ethereum, can not only host its own cryptocurrency, such as Ethereum, It can also host a variety of different digital assets and network applications. If we use a mobile phone as an analogy, The blockchain designed by Satoshi Nakamoto, like the Nokia 3310, is very stable, but is mostly used to send text messages. Vitalik's improved version of the blockchain is like a smartphone or iPhone. Sending text messages is just a basic function. You can also video chat, play games online, and develop or download different apps for use. At the same time, these apps are all decentralized. It's called Dapp, Decentralized Application. All your assets, data, and privacy on the chain do not need to be handed over to any centralized company. All are encrypted and computed by the nodes. Just like after Apple launched the iPhone, all companies started developing smartphones. Blockchains after Ethereum, Tron, Solana, and BNB Chain, are all smart contract public chains. The blockchain industry has officially entered a new era. These are different from the blockchain that Bitcoin can only use for accounting, and are called blockchain 2.0 by the community. But these are all hindsight. At the time, the above-mentioned Ethereum visions were just words on paper. To implement such a blockchain, it requires a stronger team. So Vitalik selected seven people from all the submissions and became the core members of the Ethereum startup, including Later, Charles Hoskinson, the founder of Cardano, Gavin Wood, the later founder of Polkadot, and later ConsenSys founder Joseph Lubin. Especially Gavin Wood, the then Chief Technology Officer. In the Ethereum Yellow Paper, the foundation of EVM, Gasfee and the core programming language Solidity is laid. In 2014, the initial public offering of Ethereum’s derivative cryptocurrency, ETH, achieved blockbuster success. They exchanged 2,000 Ethereum coins for one Bitcoin and raised 31,591 Bitcoins from the community, which translated into a current market value of approximately US$18 million. It was one of the most successful blockchain fundraising projects at the time. However, at first glance, with technology, community, and funds quickly in place, Ethereum’s path forward should be smooth sailing. But in fact, the issuance of Ethereum was the beginning of the split of the Ethereum core team. Charles expressed strong opposition. Charles believes that Ethereum should not raise funds from the community. It should be like a technology company to set up a commercial company to raise funds from VC. And the team is managed by the company's structure. He believes that the non-profit model proposed by Vitalik, which uses foundations for flat management, sounds ideal, but will be a disaster for organizational efficiency. Especially when you consider that your cleaners are on the same level as your senior managers, this team is crazy. However, for Vitalik, it is difficult to avoid the route of Ethereum when raising funds from VC, which is gradually controlled by external investors and establishes a commercial company structure. It will also lose the original intention of the creation of Ethereum. After all, the mission of the profitable company itself is in conflict with the Ethereum spirit of Kaiyuan supremacy and pursuit of decentralization. In the end, Charles failed to convince Vitalik. Ethereum chose non-profit foundation management and ran it with ICO funding. Charles Hoskinson also left Ethereum with his vision before the ICO, and founded IOHK the following year, starting the creation of Cardano and starting a decade-long network debate between the ETH and ADA communities. And this is just the beginning of the Ethereum split. Joseph Lubin, Anthony, who also favored corporate governance, and even Mihai Alisie, who co-founded Bitcoin Magazine with Vitalik, have also left Ethereum one after another. The most tragic thing among them is the departure of chief technical officer Gavin Wood. As the most important technical chief in implementing the Ethereum architecture, Gavin may not care most about business and profit. However, the decentralized organization had different opinions and was inefficient, which led to slow development progress, which ultimately left him frustrated. In January 2016, Gavin Wood published a farewell message on his blog. What is intriguing is that in the article, he did not mention the journey of fighting with the Ethereum team. He thanked many comrades along the way, but he did not mention Vitalik. After Gavin Wood left, he founded Polkadot to develop a multi-chain ecosystem and once became the leading project on the cross-chain track. Perhaps the impression of Ethereum in most communities started from the bull market in the currency circle in 2017. Our impression of Vitalik is that of the young V god who always leads the industry. But if you know the history of Ethereum, you will know that one day in the currency world and one year in the world. In the two years since Ethereum was founded, Vitalik has gone from the peak to the bottom, and all his founding comrades have left one after another. What's more, the biggest split in the history of Ethereum had not yet happened at that time. Although Gavin Wood’s move has dealt a blow to the morale of Ethereum. But with the upgrade of Ethereum Homestead in March 2016, the main network entered the official stage. Various decentralized applications. The sprouts of development on Ethereum have sprung up one after another, bringing vitality again. The price of Ethereum also skyrocketed after two years of decline, once soaring from one U.S. dollar to 20 U.S. dollars. At that time, among the many active projects on the Ethereum chain, the most promising project was It is a project called TheDAO. This is a decentralized venture capital fund that is completely operated by smart contracts and has no traditional fund managers. The token holders make joint decisions and share profits, which is fair and transparent. In April 2016, TheDAO completed Ethereum’s largest community financing at the time, to more than 10,000 community members. More than 100 million U.S. dollars of ETH were raised. Many potential new projects at that time were also rushing to obtain financing from TheDAO. Unfortunately, black swans always happen at such times. Less than two months after the community was happy, Ethereum witnessed the most tragic hacking incident in history. In May 2016, a hacker whose identity remains unknown attacked TheDAO's fund pool program code and stole 3.6 million ether coins overnight, amounting to tens of millions of dollars. It immediately sent the community into a frenzy, a real explosion. In terms of the current volume of Ethereum, an attack worth tens of millions of dollars may not be too serious, but at that time it accounted for more than 10% of the total circulating supply of ETH. If malicious whales alone hold such a large amount of Ethereum, in addition to the on-chain governance of POS transfer in the future, it will be difficult to implement when Ethereum is in its infancy. If tens of thousands of community members were directly hacked out of such a large amount of funds in their most optimistic active projects at one time, it is likely that the community would lose trust in Ethereum. Therefore, under the leadership of Vitalik, Ethereum carried out a technical backtracking and hard fork that was unprecedented and unprecedented. 80% of ETH holders who participated in the vote and 85% of Ethereum miners supported this hard fork. The on-chain history of Ethereum can be traced back to before the hacking incident and prevented the incident from happening. Here we want to popularize what a hard fork is. Normally, the historical record of the blockchain is irreversible. Because the blockchain is a set of ledgers that are “collectively recorded and verified by global nodes”. Anyone who wants to tamper with information for their own benefit will be caught and corrected by most other people, making it impossible to tamper with data. But on the other hand, if a majority of node validators reach a consensus that the fact that a certain block occurred should be deleted, They can also fork a new blockchain and abandon the old one by jointly modifying each other's ledger records. Although it is to fight evil and effectively save the community's funds, It was also a majority vote decision, but it still caused significant controversy and debate at the time. On the one hand, this hard fork is in the interests of most people. But from the perspective of another group of people, how can the history on the chain be changed just because of a hacking incident. If today Vitalik can call on the masses to change history for the benefit of someone important, Is it possible that one day, for example, the President of the United States will call on everyone, claiming that it is for the benefit of everyone, trying to change the history of Ethereum? With this idea, this group of miners and communities did not follow Vitalik and the new Ethereum chain at that time. Instead, we continued to work on the old Ethereum chain and developed it into the current Ethereum Classic. At this point in the story, if you look at it with hindsight, The development of Ethereum and Ethereum Classic since the split in 2016, whether it is project construction, currency price or any indicator, Indeed, it seems that Vitalik's community consensus line has achieved greater success. But no one should take it for granted. If after the hard fork incident, the Ethereum community had tasted the sweetness of being able to go back anyway, and had hastily voted for backdating every time there was a hacking incident, Then this blockchain will not go as far as what we see today. On the contrary, the new Ethereum community has more firmly set four red lines: Unless it threatens the survival of the entire chain, is technically capable of precise backoff, is supported by a majority of currency holders and nodes, and has no other solution. In addition, this type of hard fork should be regarded as the ultimate nuclear weapon, and there is no room for discussion. At the same time, the security of the program code itself has been paid more attention to. Re-entrancy audit and Bug Bounty have become the basic security standard for every project. The Ethereum community's emphasis on financial security has even promoted the birth of the entire blockchain information security sector. Major auditing white hat hacker groups such as WhiteHat Group and Consensus Diligence have appeared one after another. As a result, although incidents of projects being harmed on the chain are still heard from time to time, However, proposals that require a hard fork and backtracking of the entire chain have never appeared again after 2016. In this way, Ethereum survived the core exodus from 2014 to 2016, the currency winter in 2015, and the split between hackers and the community in 2016. They say what doesn't kill you makes you stronger. A raging bull market like a novel. It also began to brew quietly. Detonating the crypto market. 2017 was the first year that Bitcoin became popular among institutions and traditional finance. On April 1, 2017, Japan revised its law for the first time to recognize Bitcoin as a means of payment. The United States launched a derivatives market for Bitcoin futures for the first time at the end of the year. Russian officials have also publicly stated that they will give Bitcoin a legal status. With institutional attention rising for the first time, Bitcoin achieved a 20-fold increase in one year. Ethereum soared hundreds of times during the same period. And led one of the craziest copycat season crazes in history. The market was so crazy at that time. As long as you have a white paper, a piece of code, and a team in suits and leather shoes, you don’t need a company. Just issue a coin, and there will be people rushing to buy it from you. People in the old currency circle say that the craziness of that year is the bull market of 2021 or 2025, which is completely inferior to the level of ICO mania. ICO Initial Coin Offering is a new creation in the currency circle. It borrows the method of raising funds from the public through IPO when the company is listed. However, taking advantage of the blockchain and changing from issuing stocks to issuing coins, not only can it bypass supervision, but it can also be issued globally. In a market where tens of thousands of coins are flying, for many people, issuing or participating in an ICO is a legal act of printing money. At that time, the most famous money printing machine was Ethereum. Do you still remember that the characteristic of Ethereum is that it allows various applications to occur on it? In 2017, Ethereum has already begun to take shape as an ecosystem of stablecoins, NFTs, oracles, and exchanges. The ERC20 token protocol was mature at the time. You can even learn on YouTube how to issue your own cryptocurrency on the Ethereum chain. Therefore, the ICO craze in 2017 swept the world with a hundred schools of thought contending, but one super and many strong. Binance BNB, the world’s largest exchange today, Aave (tentative name ETHlend), the world’s largest DeFi platform, Chainlink, the world’s largest on-chain oracle, All were Ethereum’s ICOs that year. Even the USDT we were transferring, the most commonly used TRON chain TRX, was also raising funds on Ethereum at that time. Although Gavin Wood's DOT is not an ICO on the Ethereum chain, the initial funding base was also Ethereum. As for Cardano, who has always been in trouble in the Ethereum community, his ADA’s initial ICO raised money in Bitcoin. The subsequent stories are less unfamiliar to people. [ICO Market Situation | Highlight Report] Research points out: 80% of ICOs are frauds, and US regulation has caused a large number of ICOs to flee... As the United States, China, etc. begin to strictly scrutinize ICO activities. The project team kept running and closing, and Coincheck, another large exchange in Japan, was attacked by hackers. The cryptocurrency market's bubble quickly subsided and entered a bear market. Then the liquidity mining and staking trend in 2020 has once again ignited a new wave of bull market in the DeFi track. Boring Monkey, Jaylen Bear, and Beeple's painting "5000 Days" started the NFT craze. The Sandbox and Decentraland are blowing the wind of the metaverse. Even Facebook renamed the entire company Meta. With the outbreak of this bull market, everything mentioned above once again started on Ethereum. But once again, when the liquidity mining trend ended, NFT issuers left like the ICO issuers back then, and the Metaverse became one digital mosquito den after another. Along with the death spiral of Terra/LUNA in 2022, and the insolvency of FTX. The cryptocurrency market behaves like a four-year cycle. It was destined to reach its peak in 2013, 2017, and 21, but fell to the bottom in 2014, 18, and 22. And when the news tells you overwhelmingly once again, cryptocurrency has been proven to be a bubble. Internet celebrities are once again beating gongs and drums to laugh at you. Decentralization is just a way of cutting leeks. But you can clearly know. 99% of ICOs may be bubbles. Every bull market and every innovation may bring a certain degree of destruction and pain. But every time the bubble dissipates, projects with real strength and vision will remain. Innovation is not infallible, quite the opposite. It is precisely the experience of getting up from every fall and adhering to the unchanging spirit of decentralization in every change. It has become the most important flesh and blood of the blockchain industry and the Ethereum community that has grown to this day. It is precisely because we have learned from the experience of tens of millions of hackers that we were able to develop Ethereum, which today carries hundreds of billions of dollars in security attributes. It is precisely because we learned the lessons after UST returned to zero that we were able to write the details of the Genius Act (GENIUS Act) in the United States today. It is precisely because we returned to the essence after the bankruptcy of FTX and the importance of decentralization, DeFi, wallets and exchange asset reserve certificates that we have been unanimously recognized by the community and enterprises. Today in 2025, Ethereum has passed its first decade, and its total market value has quietly reached $500 billion. Ranked among the top 30 global assets. This round of bull market in the currency circle will no longer sound only in the currency circle, but also in the voice of innovation in Wall Street and even the global financial market. Every year, Larry Fink, chairman of BlackRock, the world's largest asset management company with more than ten trillion dollars under management, writes a letter to investors, He also puts forward views and policy suggestions that affect the global investment community. His theme in 2025 is the decentralization of investment. In this letter, Larry Fink starts from the historical trajectory of the entire financial and investment industry, Capitalism and investment behavior are explained. How to bring today's prosperity to Western civilization, and at the same time, he also pointed out what kind of huge challenges we are facing at the time point we are now at. Just like social innovation, civilization brings rapid development, The investment market has also evolved with the advent of electronic technology and index ETFs. Gradually changing from the privilege of a few people to the opportunities and rights of everyone, and creating considerable growth in personal and national wealth. I don’t know about you, but I’m very impressed. More than ten years ago, people said that investing is dangerous, and we ordinary people just need to save money. But in recent years, the concept has become that we should at least passively invest in ETFs instead of just saving money. But Larry Fink said. Although we have made great progress in the decentralization of investment, Many investment targets that bring important growth, such as roads, energy, cables, and ports, are infrastructure construction. Infrastructure construction belongs to the private market. Under the current financial system, public funds cannot invest in this type of private market. Looking at the next 20 years, with the rapid development of AI, new energy and other technologies, funding requirements for this type of infrastructure. will be as high as $65 trillion, If such investment demand exists, it can break the privilege restrictions of the private market under the current system. Not only can the country’s infrastructure develop more rapidly, It can also allow the people to more fully enjoy the benefits of the economic growth flywheel and compound interest. The key to breaking this privilege restriction is asset tokenization. Tokenization is democratization. The so-called asset tokenization is to convert real-world assets, such as stocks, bonds, and real estate, into digital tokens that can be traded on the Internet. Each token is like a digital title certificate, proving your partial ownership of an asset. It is different from traditional capital. These tokens are safely stored on the blockchain, and you can transfer and buy and sell them in time without the need for cumbersome paperwork and waiting. Larry Fink said that all stocks, bonds, funds and assets can be tokenized. By dividing property rights into tokens on the chain, private markets that would otherwise be unavailable to people's investment will be accessible. The original investment privileges caused by legal and bureaucratic issues will also be broken. Not only that, the tokenization of assets will also bring innovative changes to the entire financial market. The stock market will not have to close. Transactions that today take days to complete can be cleared in seconds. And the billions of dollars that were supposed to be frozen due to settlement delays can be immediately reinvested into the economy to drive more growth. The most influential CEO in the world's financial industry, based on the prosperity of the country and the well-being of the people, conveyed the vision of asset tokenization to the world. Perhaps in the eyes of many people, finance is a group of people who make a lot of money without actually making any contribution. But as Larry Fink said, from history to the present to various large-scale infrastructure construction and technologies in the future, All require investing a lot of money and resources that may fail before seeing the results. Before technology and concepts have arrived, many more important and potential investment targets may have reason to limit participation to a small number of elites. But with the rise of people's concept of investment, the inflation of the legal currency system, and the maturity of the underlying technology that makes everything possible, liberalized investment, It is a value worth protecting, worth expanding, and worth decentralizing. The asset tokenization and blockchain mentioned in Larry Fink’s letter are undoubtedly the main focus of the current US government’s most active development. The stable currency bill, commonly known as the "Genius Act", has passed Congress at lightning speed. Stablecoins are legal currencies such as US dollars and Japanese yen on the blockchain. Governments around the world, from Europe to Asia, have all begun to develop relevant systems. Put your country’s legal currency on the blockchain. The U.S. Securities and Exchange Commission (SEC) proposed a Project Crypto reform plan to reshape the U.S. encryption industry in five major directions. Promote the integration of blockchain assets in traditional markets and promote the listing of capital markets on the blockchain. Robinhood, one of the largest retail brokerages in the United States, In addition to announcing its entry into the on-chain token market, it also personally built a second-layer network blockchain. As for all the regulations and giants, they may not clearly mention which blockchain, and the current blockchain market is undoubtedly a multi-chain development. But from the standards of mature blockchain mentioned in the Genius Act, BlackRock’s first tokenized fund product issuance chain, The chain with the most stablecoins in the world, as well as giants such as Robinhood and Coinbase, have chosen the underlying chain of Layer 2. All point to Ethereum. The most common comparison between Web 2.0 and Web 3.0 is that in the Web 2.0 era, you can create content on the Internet and watch content on the Internet. But these things are all the assets of large companies. But in the Web 3.0 era, for the first time, people can not only read and write, but also own. What I want to tell you now is, Not only will you have the opportunity to witness this financial revolution, you will also have the opportunity to personally own a part of Ethereum. The way is through Ethereum. If the underlying blockchain of Bitcoin is the technology that exists for the digital asset Bitcoin, Ethereum is just the opposite. The digital currency of Ethereum is a functional asset that exists for the ecology of the Ethereum chain. They are also decentralized consensus layers based on distributed ledgers. Does Vitalik have the final say in Ethereum now? no, Is it the foundation or Tom Lee who has the final say? no. The operating mechanism of PoS is that as long as anyone holds a part of the ETH coins and pledges them to the blockchain, you can participate in verifying and maintaining everything on the Ethereum blockchain. You can become a validator, While maintaining the operation of the Ethereum blockchain, you can earn Ethereum rewards. The more you stake, the more ETH rewards you earn. Just like the oil industry. Oil itself had no value in the first place. But when cars, trains, and planes all over the world began to use petroleum refineries as fuel, then people all over the world changed from ox-carts and horse-drawn carriages to all driving cars. Oil has suddenly become one of the most important commodities in the world. This is why many people say that Bitcoin is digital gold, but the second largest cryptocurrency, Ethereum, does not use digital silver as a metaphor. Ethereum is "digital oil." Users need to pay Ether and it will be burned, Nodes will mine Ethereum and make profits from it, The price rise and fall of Ethereum is not a value storage model, but an energy supply and demand model. The more developed the industry, the higher the value of oil, and the more developed the ecology on the chain, the higher the value of Ethereum. Of course, the reverse is also true. If one day the petrochemical industry can be replaced by new energy, oil will withdraw from the world economic stage. If the tokenized economy we are talking about has not actually happened at all, or it has happened, but it has not mainly happened on the Ethereum chain, The price of Ethereum may not be able to see the future. So if financial decentralization means freedom, Your investment also means you need to be responsible for yourself, If you want to maintain the development of the network by staking Ethereum, then I agree with both hands. But if you want to make money by buying and selling Ethereum, you must also know, The most important potentials and risks of Ethereum on the currency side. The first and greatest potential of Ethereum, It is the real demand for asset tokenization from traditional finance. If the XRP introduced last time aims to occupy a place in the cross-border payment flow of institutions, So Ethereum refers to the asset tokenization market worth hundreds of trillions of dollars. According to data from SIFMA’s Capital Market Fact Book in 2025, As of 2024, the total market value of global stocks has reached US$126.7 trillion. The global fixed income market, including bonds, is approximately US$145.1 trillion. If you add real estate, precious metals and other assets, The total amount of global financial assets can easily reach hundreds of trillions, or even reach the level of trillions of dollars in a few years. What is the concept of hundreds of trillions of dollars? You must know that the current total market value of global stablecoins is only about 270 billion US dollars. Tokenized assets other than stablecoins, including BlackRock’s BUILD fund, are only over US$10 billion. Take this number into account and listen to what agencies predict. McKinsey, the world's largest consulting firm, predicted in 2024 that the tokenization of global assets will reach a scale of more than US$1 trillion within five years. In their latest report in 2025, they even predicted that the market value of stablecoins alone would reach at least US$2 trillion in 2028. Coincidentally, S&P Global, the company behind the S&P500, the largest index in the United States, also mentioned in a report in August this year, Even excluding the market value of stablecoins, global asset tokenization is expected to grow to US$4 trillion by 2030. If so much funds are to be deposited on the chain, The attributes they care about most are not the performance, UI, UX, and handling fee differences that old currency circle people pursue. What they pursue is safety. Ethereum, which has gone through ten years of stress testing and hosts the most DApps, the most communities, and the most developers, There is no doubt that it has become the first choice of Wall Street and global financial markets. From the data, we can see that in the stablecoin market with a total market value of 270 billion, more than 50% of the issued chains are Ethereum. Circle, the first listed stablecoin company in the United States, has more than 60% of USDC issued on Ethereum. BlackRock has two cryptocurrency ETFs. Apart from Bitcoin, the only one is Ethereum. The largest national debt tokenized BUIDL fund in the United States is issued on the Ethereum chain. S&P Global announced in July that it would cooperate with Centrifuge, an on-chain technology company, to combine index compilation with on-chain technology. Judging from their collaborator Centrifuge, these innovations will probably also happen in Ethereum. Not to mention the current President of the United States, Trump, whose own family’s DeFi project, World Liberty Finance, is also issued on Ethereum. Of course, there is also progress in tokenized funds that choose to be issued in Solana and BNB Chain, but there is no doubt that Ethereum is definitely the home field of adoption. And once the momentum of asset tokenization is established, there will be trillions of dollars in capital flows. Second, approaching a perfect token economic model. In the stock market, the number of stocks you own is approximately equal to how much ownership you have of the company. But in the currency circle, holding cryptocurrency does not necessarily mean you have ownership of the blockchain project. Depending on the design of each token’s economic model, The value capture capabilities of some cryptocurrencies are very questionable. The binding of Ethereum to ETH can be said to be a model of value capture and economic model in the currency circle. After several years of technological upgrading, ETH is designed through these three key characteristics, functionality, inflation and security. Firmly bind the currency price valuation to the value growth of Ethereum. First, functionality. ETH is the native token of Ethereum. For all transfers, payments, smart contract deployment and deployment performed on the Ethereum blockchain, users or developers must pay a fee, called Gas Fee. The currency used for this Gas Fee must be Ethereum. This is a bit like if you are in the United States, you can only spend money in dollars, and if you are in Europe, you can only spend money in euros. If you want to use Ethereum, you have to use Ethereum to spend it. This is the first layer of binding between ETH and Ethereum. As long as more people use Ethereum, the functional demand for ETH will rise. From the supply and demand theory of economics, we know that if other things remain unchanged and demand increases, prices will rise. Second, the supply model of ETH, Since the London Upgrade in 2021 and The Merge in 2022, it has become an extremely low inflation model with an average annual increase of only 0.13%. Let’s talk a little more deeply about the concept of Ethereum blockchain. In addition to being like the Bitcoin chain, a portion of new ETH will be continuously mined from the chain to the verifiers. After the EIP1559 upgrade, It also burns a portion of the Gas Fee each time the user pays. In other words, Ethereum’s inflation model is dynamic, Every minute, every block, as the activity on the chain increases, the Ethereum coins in the market may even become increasingly scarce, becoming deflationary fuel. Although it should be invisible and look like an oil crisis, this seems to be another metaphor for digital oil. The increase and decrease rules behind this are also decided jointly by all Ethereum communities. One day, after Vitalik retires, the new leader will issue more if he wants. By the way, Bitcoin’s current inflation rate is about 0.9%, which is already better than gold. However, the average inflation rate of Ethereum over the past two years is 0.13%, which is even better than Bitcoin. This is why the Ethereum community often laughs and says, Bitcoin is a super good currency, it is Sound Money, but Ethereum is a top currency, it is Ultra Sound Money. Third, security, this is the most underestimated attribute by people in the currency circle in 2025. Ethereum’s underlying consensus mechanism, Proof of Stake, PoS, Allows anyone to jointly maintain the rules of the blockchain by staking ETH. This thing achieves the goal of distributing its security to anyone in the world. You can't break into the Ethereum mainnet by attacking any host, Coinbase's host, Vitalik's host. But you can buy out all the Ethereum in the world, and then become a large node with more than half of the voting rights to control the operations on the chain. This is quite a decentralization in the spirit of capitalism. Compared with Bitcoin’s PoW consensus, Ethereum is a blockchain that is relatively easy to be attacked. But why I say this is an underrated attribute of Ethereum, the answer is the cost of attack. The current total number of pledged nodes in Ethereum is about 30% of the total market value, which is almost 150 billion US dollars. If you want to attack it, you only need to buy 200 billion US dollars of Ethereum in the market and become more than half of the nodes. But it sounds like some super rich people, or a country-level fund, can generally do it. But the question is today’s Ethereum. Is it worthwhile for you to spend such funds to attack it? The next question is, Suppose BlackRock launches an AUM (total value) tranche today, and a $1 trillion fund is placed on the Ethereum chain. Do you think he slept well at night when he heard that Ethereum only needed $200 billion to attack? It is estimated that his attack can directly affect the proportion of this fund. But at least, if I want to convince my customers today, I have to tell them that the cost of attacking Ethereum is far higher than his chance of profit. The cost of his attack is linked to the price of Ethereum, the total number of Ethereum pledged, and the degree of dispersion of pledged nodes. When you understand this level, imagine the simplest fact, Today Ethereum can not change anything, as long as the currency price doubles, The cost of this attack instantly increased from US$150 billion to US$300 billion. When you understand this level, you will know, Why is BlackRock rushing to launch an Ethereum pledged ETF before everyone understands Bitcoin? Because the pledge of Ethereum in hand represents far more than just a 3% annualized return. The rise in the price of Ethereum far more than just represents the increase in value of the assets he bought at low prices. The most important thing for BlackRock, a financial services provider, is that these two things represent their improvement in the security of the entire Ethereum chain. Third, institutional-level strategic reserves, The most aggressive people grabbing Ethereum during this period are definitely not retail investors, but institutions. Tom Lee, known as the fortune teller on Wall Street, was the man who recommended everyone to buy Bitcoin in 2017. And in 2025, he switched sides, He joined Bitmine, a company originally engaged in Bitcoin mining, and changed the company model to a strategic reserve of Ethereum. And with lightning speed, he became the largest holder of Ethereum in the market, and his company is not the first. There is a company called Sharplink. Since the chairman was replaced by Joseph Lubin, it has also quickly begun to accumulate Ethereum coins. It is currently the second largest holder of Ethereum coins in the world. If you add another listed company, The Ether Machine, The amount of Ethereum held by these three listed companies has surpassed the number of holders of the Ethereum Foundation every minute. And those who are very optimistic about these companies, In addition to Ark Investment, which is very keen in the technology industry, Peter Thiel, the legend who created Meta and PayPal, Even the Trump family’s DeFi project has already accumulated a lot of ether coins. You said that many people exited the market in batches to take profits during this period. Who did they sell their coins to? I think the answer is obvious. Ethereum is the same as any cryptocurrency. The currency price rises and falls too often over a period of time, making people ignore the risks. If you are not careful, you may have too much FOMO. If a black swan really happens one day, the U.S. stock market and the currency circle will dive together like the original metaverse bubble and the Internet bubble. It's definitely possible. Therefore, before you actually spend money to buy ETH, you must also be aware of these biggest concerns. First, financial bubbles. When we describe on-chain finance and asset tokenization, Please note that these are trends, but they are also the future. Although the market value of stablecoins continues to rise, although regulatory deregulation continues to occur, But you always have to know All the bulls we see have been seen by others. Reasonable optimism can create economic prosperity, But once the market is overly optimistic and prematurely overpriced, it means the risk of bubbles. Especially now that the U.S. national debt has reached $37 trillion, This is not just 120% of the U.S. GDP for a whole year, Moreover, debt interest expenditure alone has exceeded national defense expenditure. The U.S. unemployment rate is now at a post-pandemic high of 4.2%. Although the inflation rate is under control, it is still far away from the Federal Reserve's 2% standard. More importantly, Trump’s tariff policy has just been implemented. The potential price rise and rebound in various countries, There are still sporadic wars going on in Israel, Ukraine and other places. U.S. stocks have also been pushed to historical highs by AI concept stocks. Any black swan event that affects the entire world is something we must pay close attention to at this point in time. Ray Dalio, the founder of Bridgewater, the world’s largest hedge fund, has warned many times recently that If the United States does not reduce its fiscal deficit, it will suffer an economic heart attack within three years. One of Buffett's most respected investors, Howard Marks of Oaktree Capital, publicly stated in August that the U.S. stock market was already in the early stages of a bubble. Today, when the trends of Bitcoin and Ethereum are increasingly linked to Wall Street ETF funds, Even if some people argue that Bitcoin can fight financial crises like digital gold, But Ethereum is regarded as the general infrastructure of the underlying network. When it comes to the Internet and black swans, the Internet bubble in 2000 is definitely a prospect that all investors in the currency circle need to continue to treat with caution. Second, the trend is reversed. If Wall Street begins in 2024, BlackRock will be the biggest driving force. In 2025, the White House and Congress will begin working to make on-chain finance compliant, and the biggest push is undoubtedly Trump. But as Howard Marks said, investors should not assume that market conditions will not change. Even if we estimate optimistically, financial bubbles will not happen in the short term. But one of the reasons why Trump can push forward all the political reforms he wants so quickly is that Republicans hold more than half of the seats in Congress. As the 2026 midterm elections approach, can the Republican Party still hold a majority? Will Americans vote against his series of radical executive orders such as the Big and Beautiful Act, the Genius Act, and the Tariff Order during this term? You must know the reason why all funds are now optimistic about the prospects of asset tokenization. One of the biggest conditions is the full support of this government. If you want to predict the development of the on-chain economy in 2030, I am afraid that the 2028 US election will also be a variable that must be considered. Three, Ethereum killer. Every bull market has its so-called Ethereum killer. Although most of the public chains that have claimed this title in the past did not end well, We should not think that Ethereum is the only public chain that can legitimately carry traditional financial flows. Among the digital asset reserves mentioned by Trump, he also mentioned Solana and Cardano. Among the major strategic reserve companies in the United States, there are also many listed companies that reserve BNB, TRX, and SOL. Stablecoin issuers Tether and Circle have also jumped out and want to build their own blockchains. Although all of the above may not be as large as the Ethereum chain today. But who knows? Who knows if there will be any internal explosions in Ethereum? Aave has liquidity risks, and the re-pledge project has a death spiral. Or Ethereum’s strategic reserve company didn’t manage its money well. Or the layout is too small, just sell ETH on that day, If you look at currency prices, the volatility and risks of Ethereum have never been less in the short term. I have never seen the community only praise and not criticize Ethereum on any day. Ethereum’s POS has been criticized by countless Bitcoin maximalists. Gas Fee is expensive, Ridiculed by countless supporters of high-performance public chains, even the development of Ethereum Layer 2 can be considered negative for the devaluation of ETH, because it will reduce the demand for ETH consumption. But in any case, for those who invest in this market for the long term, be aware of any risks and learn not to overreact. Paying attention to any bubbles and learning healthy asset allocation are always the most important issues for us to survive and profit in any financial market. Thank you all for watching this. This video is the most important video on this channel so far. It’s not that I can predict that Ethereum’s future will be bright. But when I first entered the currency circle, by chance, I started not with Bitcoin, but with Ethereum. My first internship in the cryptocurrency industry was at Dapp Pocket, a wallet provider, writing a weekly DeFi report. DeFi was on Ethereum at the time. We also received sponsorship from Aave. It was 2020, an era when Ethereum was as low as $90. Half a year later, I started the Nao Ge channel on my own. You can tell from the history of this channel that half of my first ten videos are about Ethereum, and the most familiar track in the past few years has always been DeFi. My investment vision is not comparable to that of many great people in the cryptocurrency industry, so I see Ethereum gradually moving from the grassroots to the mainstream in the past few years. I myself have gone from having a little understanding of faith to now having my own understanding. I will tell you the comparison between smart contracts and smartphones, and describe digital oil in my own way, It is true that I have made money on Ethereum. I really feel very grateful, because what I have done is completely incomparable to the contributions of other engineers and developers. Bitcoin was my first door into the cryptocurrency world, but Ethereum was the first reason why I stayed. I can’t write programs, and I don’t have much influence in the financial circle. For me, making a video about Ethereum that can be understood by more people in a correct way earlier is the biggest thing I can do for this industry at this stage. So thank you all for watching. Your views, likes and shares are all important elements of our video platform algorithm. Just like how Ethereum has come to this day, it is not just Vitalik’s efforts alone. There is also a vast community with common ideas, from developers, clients, verifiers to currency holders, the result is the result of the contribution of everyone.
I will continue to learn, record, and output； For more information, welcome to follow me If you want to communicate directly, add me on corporate WeChat  |
|
|
|
|
|
