#203: Made $10B in less than 8 years

• Ethereum (ETH) is the 2nd biggest cryptocurrency in the world at a ~$186B market cap as of writing (the biggest one being Bitcoin, at ~$524B market cap)

• Today we’ll take a look at:

  • How is Ethereum different from Bitcoin?

  • How does Ethereum make money?

  • What are some factors affecting Ethereum’s revenue?

BTC vs ETH

While Bitcoin is the "og" cryptocurrency and still is the biggest one by market cap, Ethereum is more than just a coin -- it is a decentralized computer network that allows decentralized applications (DApps) to run

• Ethereum is arguably the "next level version" of Bitcoin, since Ethereum not only uses blockchain technology to allow for monetary transaction, but also allows both transactions and applications to function on top of the Ethereum network.

• Now, as much as Ethereum is a lot more functional and versatile, one pays fees ("network fees" or "gas fees") for transactions and activities on the Ethereum network -- payments, minting and trading NFTs, sending cryptocurrency payments.

It took Ethereum less than 8 years

It took Ethereum (as an ecosystem, not necessarily a company) around 7.5 years to reach $10B in annual revenue, faster than Meta (took a little over 7.5 years) and Microsoft (took 19 years)

• These gas fees (which are paid in ether, Ethereum's antive currency) help the Etehreum network secure, as fee structure prevents bad actors from "spamming the network"

• The gas fee payouts are rewarded to those staking their Ethereum (aka those who make support and secure the network)

VanEck, a global investment firm with over $76B in assets under management (ask of Sept-2023), predicts the Ethereum network revenues rising to $51B in 2030.

Just as an aside: if you’ve been reading Ask a Wise Ape for a long time (thank you!), you’ll remember this article where I talk about how I buy $100 worth of Ethereum every month. (I still do that!)

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as always, i’m no financial advisor! (i’m no substitute for professional financial services)