Quinn Thompson declares Ethereum 'completely dead' as an investment - debates flare over the future of the leading blockchain

Quinn Thompson declares Ethereum 'completely dead' as an investment - debates flare over the future of the leading blockchain

The Ethereum Controversies: Is ETH Really “Completely Dead”?

This past weekend, Quinn Thompson, chief investment officer of hedge fund Lekker Capital, caused quite a stir in the crypto industry. In a post published on X, he described Ethereum (ETH) as “completely dead” – at least from an investment perspective. This controversial statement drew numerous reactions within the community and raised questions about the future and economic value of Ethereum.

“ETH as an investment is completely dead”

Thompson bases his assessment on the fundamental economic weaknesses of the Ethereum network. Despite a market cap of over $225 billion, it has observed a decline in user growth, transactions and fee revenue. For Thompson it is clear: "ETH no longer offers an investment argument. A network with applications? Yes. An investment? Absolutely not."

Layer 2 as a cause of value fragmentation

One of the reasons Thompson cites for the deteriorating investment thesis is the growth of Layer 2 solutions (L2s). These scaling solutions would take significant value away from the main network. Additionally, the growing number of tokens in the Ethereum ecosystem leads to fragmentation. Nic Carter, partner at Castle Island Ventures, made a drastic statement, saying: "ETH was buried under an avalanche of its own tokens. Suicide."

Experts defend Ethereum

The harsh criticism was not without resistance. Professor Omid Malekan from Columbia Business School defended the role of Layer 2 networks. He argues that they are essential to scaling Ethereum, so it is understandable that they claim some of the value for themselves. “Security is not free,” he emphasized.

Scott Johnsson of VB Capital also strongly disagreed with Thompson. He pointed to Ethereum’s unique token architecture with a deflationary combustion mechanism that acts as an economic strength. “If the consumption of ETH is comparable to that of oil, then the price of ETH is much more likely to lock in value,” he explained.

Future of Ethereum remains controversial

Without a doubt, the technological relevance of Ethereum is undisputed. But the discussion about the long-term investment value of the ETH token is in full swing. Once the undisputed king of the DeFi world, Ethereum is facing growing competition from other blockchains. In this new reality, the network is finding it difficult to maintain its economic dominance.

The debate surrounding Ethereum and its future value is sure to remain controversial and could be crucial to the development of the entire crypto market.