CNBC analyst says of risks for investors after the Ethereum upgrade
Brian Kelly noted the possibility of a failed upgrade, which could negatively affect the price of the asset
04.09.2022 - 07:00
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2 min
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What’s new? The CEO of investment firm BKCM and CNBC analyst Brian Kelly has given his opinion on Ethereum’s prospects. In his view, the upcoming upgrade to the network carries risks for investors. Kelly believes that they may not get as much return on profitable trades as expected because of ETH’s inflation mechanism.
What else did Kelly say? He expects investor excitement ahead of ETH’s mid-September transition from the Proof-of-Work (PoW) consensus algorithm to Proof-of-Stake (PoS) will inevitably lead to a sell-off of the asset. In this, the analyst warns that there is also the possibility of a failed upgrade, which could negatively influence both the price of the asset and the project itself.
Looking at the economy in a broader sense, the analyst discusses the correlation of cryptocurrencies with the tech stocks sector, while emphasizing the fundamental differences between bitcoin and Ethereum. Kelly added:
“Bitcoin correlation with the Nasdaq is somewhere around 60%. Ethereum correlation with the Nasdaq is somewhere around 70% for the rolling last 30 days. […] I think there’s some nuance here, in that Bitcoin itself is not a tech stock. […] Ethereum, on the other hand, can be somewhat thought of as a tech stock because it is going to disrupt a lot of what tech stocks are doing today.”
As of September 3, 12:20 UTC, ETH is trading at $1553, having lost 2,53% per day, according to Binance. Bitcoin is trading at $19, 28, having lost 1,47% per day.
Earlier, representatives of cryptocurrency exchange Binance reported on its official blog that they would support The Merge upgrade. The platform also allowed the listing of tokens that may emerge as a result of potential hard forks. Listing decisions will be made on a case-by-case basis.
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