Compiled by: SevenUp DAO, Peyton
Video source: The TRILLION dollar ETH Bet
Ethereum ETF is coming. What is the best narrative to sell Ethereum to traditional finance/Wall Street? Ryan and David from the Bankelss channel discussed the 7 major narratives of Ethereum and had a pitch competition between them. They each prepared a 1-2 minute pitch, and then each spent some time analyzing the other's content and analyzing each point.
Tweets by Eric Balchunas
David: Today’s show actually originated from a tweet from Eric Balchunas, who pointed out a challenge facing the Ethereum ETF: distilling the vision and value of Ethereum into an easily digestible slogan like “Bitcoin is digital gold” to penetrate the world of the 60+ year old pre-baby boomers. Does Ethereum have a simple slogan? If so, what is it? Bitcoin is digital gold. The beauty of Bitcoin is its simplicity, which can be described clearly in a concise slogan, while the scope of Ethereum is so broad that I think it will take at least 60 seconds to explain it clearly. Therefore, we set a time limit of 60 seconds for the promotional speech of the Ethereum ETF at the end of the show today.
I think the Ethereum slogan comes from a broader understanding of Ethereum. Is there a single defining sentence for the Internet? I'm not sure, but everyone knows what the Internet is. For example, in the 1990s, the Internet might have been called e-commerce, which is accurate, but only a small fraction of the total value that the Internet would eventually drive. The Internet became a collection of many different use cases. I think the same is true for Ethereum, where there are periods where one meme or slogan works, then fades away and another takes its place. Every few years a different narrative emerges.
Ryan: I find it interesting that this is actually a common criticism that Bitcoin maximalists level at Ethereum. They say that Ethereum keeps changing its narrative.
David: It’s not just changing, it’s evolving. I identified four narratives that came to mind first: digital oil, internet bonds, programmable money, and tokenized platforms. These are some of the narratives we proposed in Bankless. After this tweet, I further validated these narratives and added new ones to the list, resulting in seven different perspectives on Ethereum as an asset.
ETH is a tokenized platform
David: I started with Ethereum as a tokenization platform because it is one of the most novel ideas in the ETH pitch. When writing ETH pitches, Ryan and I don’t usually emphasize Ethereum’s role as a tokenization platform because it might seem a little unconventional to start by discussing Ethereum to sell ether. However, if you only have 60 seconds, this nuance doesn’t matter. Ethereum and ether are almost synonymous to those who don’t understand the difference. And tokenization as a concept has broad appeal.
This was highlighted by the opinion of Zack Ryne (@ChainLinkGod), who noted that every financial asset in the world will eventually be tokenized on-chain. The mantra of “tokenizing the world” has been popular in crypto cycles. He asserted that it is no longer a question of “if” but “when”. While regulatory clarity remains a challenge, Larry Fink, co-founder and CEO of BlackRock, has spoken publicly about this inevitability. Although the SEC has always been opposed to cryptocurrencies, Larry successfully obtained SEC approval for his Bitcoin and Ethereum ETFs.
In addition, BlackRock:
It launched its own tokenized fund $BUIDL on the Ethereum mainnet, currently managing $460 million in assets.
Invested in Circle, the company issued $USDC, the second largest tokenized US dollar asset.
Invested in Securitize, one of the leading tokenized asset issuance companies.
The technical architecture of Circle and Securitize was used to issue $BUIDL.
There is no doubt that $BUIDL will not be the last fund that BlackRock tokenizes on a public blockchain. Relying on Ethereum as a tokenization platform, as well as leveraging the credibility of BlackRock and Larry Fink (who has many elderly clients), is crucial. It is very valuable to understand how he uses and promotes ETH to his clients. Therefore, Ethereum as a tokenization platform should be a core component in any typical ETH promotion in traditional finance.
Ryan: Tokenized platforms are not typically marketed to crypto native users, but are more likely to resonate with traditional finance users. This is the marketing tactic that Larry uses, and his clients are likely to be buyers of ETFs. BlackRock is the leading issuer of Ethereum ETFs and the leading issuer of Bitcoin ETFs in terms of assets under management. He knows how to market it, so tokenized platforms are a major narrative in this space.
David: We all felt a certain feeling when we first learned about tokenization. Thinking back to what really got us excited during those initial days of entering the crypto world - the concept of tokenization and tokens was definitely among them.
Ryan: When I first came into contact with Ethereum, I often said that Bitcoin is a single-asset platform - there is only one asset, Bitcoin. Ethereum is a multi-asset platform with multiple assets, which is consistent with the concept of tokenization.
ETH is an app store
David: OK, now let’s talk about the second narrative: Ethereum is an app store. This idea comes from Jeff Dorman, who tweeted, “Attention BlackRock, VanEck, Digital Assets, and Bitwise: Once the ETH ETF is listed, please remove the words “supercomputer”, “ultra-sound money”, and “internet bonds”. These words do not resonate with anyone. What narrative does resonate? Ethereum is an app store.” This angle appeals to a lot of people because even those who don’t have a crypto background and don’t know what Ethereum is, the concept is very familiar.
When promoting Ether to people who don't know much about Ethereum, we need to draw on their existing knowledge. People know what an app store is and what a developer platform is. Describing Ethereum as a technology platform that grows with more code and developers building applications is a concept that everyone is familiar with. As to whether Ethereum is actually an app store, we can debate it, but that's not the point. It is a developer platform, similar to an app store, and its usefulness grows as more developers contribute.
Ryan: We recently saw Vance Spencer effectively promote this in a conversation with Bloomberg. He described Ethereum as an app store and showed off various applications like Aave, Compound, and Maker. He pointed out logos for different types of financial applications, creating a sense of familiarity. You can point to applications that are actually deployed on Ethereum and say, "You want a mortgage? Go here. You want a stablecoin? Here's USDC." This narrative resonates because everyone knows what an app store is. Almost everyone you're going to promote an Ethereum ETF to has used an app store and has an app installed on their smartphone. This links back to the last major computing revolution, the mobile revolution. Ethereum can be as great as the iPhone.
David: I remember we had Mark Cuban on the podcast in mid-2021. He shared that some of his friends downloaded Coinbase and asked him, “Where are the decentralized apps?” They were expecting to see an app label on Coinbase, not understanding that the reality was more complicated. People were ready for the app store perspective. They just needed some adjustment and education to fully understand it.
Ryan: They’re ready. The weakness of this narrative is that it falls apart when people ask, “Where’s the app store?” People discover that there’s no centralized place to download apps, see reviews, or start using them. It’s more like the internet, where you have to explore on your own, and there’s no centralized, polished app store experience. It’s a little more crude.
David: I agree that the metaphor does have flaws, but we have to keep in mind the target audience. The target audience is buying the ETH ETF, and they can't use them in any application. They are not users, they are investors. They buy the ETF for exposure, not to use these applications. So, we can use their unfamiliarity with crypto to make outreach easier, not harder.
ETH is an operating system and app store
David: This view comes from Ryan Rasmussen of Bitwise Invest, who believes that Ethereum is an operating system and app store for crypto applications. Adding the operating system angle distinguishes Ethereum from Bitcoin and helps build a stronger foundation of understanding. Bitcoin is digital gold; it only supports Bitcoin as an asset. Ethereum, on the other hand, is an operating system and developer platform, similar to other smart contract platforms like Solana. This distinction helps those who are not familiar with cryptocurrency understand that Bitcoin is unique as digital gold, while Ethereum is a technology platform on which applications can be built. Emphasizing the operating system angle strengthens the narrative of the technology platform and makes it easier to understand.
Ryan: At the beginning, you asked me if I had another narrative to add. I didn’t have one at the time, but let me add one now – a little bit further than what you mentioned. Don’t just think of Ethereum as an app store or an operating system, think of it as the Internet of Value. This idea suggests that Ethereum is less like an app store controlled by one company and more like the Internet of Value – permissionless and open to anyone. This may provide a more comprehensive narrative.
David: I couldn’t agree more. “Internet of Value” is more accurate, but it’s more of a crypto-native statement. It sacrifices some familiarity for accuracy. Someone hearing this statement might have an “aha” moment, but if I were pitching to a 60-year-old investor, “blockchain app store” would probably resonate more than “Internet of Value.”
Ryan: I agree. “Internet of Value” feels too vague. “Blockchain App Store” is more specific and easier to understand.
ETH is digital oil
David: Let’s dive into the “ETH is Digital Oil” narrative. This narrative compares ether to oil, which is essential to running the Ethereum network. Just as oil powers machines, ether powers decentralized applications on Ethereum. This metaphor emphasizes the role of ether as a resource required for transactions and smart contracts, making it integral to the operation of the network.
Ryan: The “digital oil” analogy is very powerful. It emphasizes the utility and necessity of ether by comparing it to the role of oil in the economy. This narrative helps convey the idea that as more applications and transactions occur on Ethereum, demand for ether will increase, just as industrial activity drives demand for oil. It’s a simple and easy-to-understand metaphor that effectively communicates the utility of Ethereum to a wide audience.
David: I agree. “ETH is digital oil” captures the central role of ether in the Ethereum ecosystem. It’s a familiar and easy-to-understand metaphor, making it a powerful narrative to explain Ethereum’s value proposition to both crypto natives and newcomers. This narrative helps bridge the gap between complex blockchain concepts and everyday understanding.
ETH is the Internet bond
David: Now let's discuss a narrative that is not suitable for beginners, but is helpful for in-depth understanding: Ether as Internet Bond. This concept is recognized within the crypto community, but it may be complicated for those who are new to Ethereum. Currently, the staking rate of Ethereum is about 3.2%. Staking ether means that you lock assets in the network to obtain this yield, similar to buying a bond.
This narrative compares ether to bonds in the context of DeFi. The idea is that staking ether is a low-risk, yield-generating activity in the cryptoeconomy. However, this requires a foundational understanding of DeFi and ether’s role within it.
Ryan: I like this narrative because it clearly differentiates Ethereum from Bitcoin. Staking ether provides a yield, just like sovereign bonds, and the global sovereign bond market is worth about $70 trillion. Comparing Ethereum to a country and staking it to bond yields helps explain Ethereum's unique value proposition. This metaphor works very well for those who are deeply involved in cryptocurrency, and they understand how Ethereum secures property rights.
However, this is a difficult narrative to understand for traditional finance audiences and those purchasing ether for the first time. Currently, Ethereum ETFs do not provide staking yields, meaning that investors only receive the asset itself without the associated staking yields.
David: Yes. Calling ether an “internet bond” can be confusing to people who are familiar with government or corporate bonds. It’s hard to explain why ether functions like a bond in a decentralized network without extensive background.
Ryan: It is true. For traditional finance professionals, the word “bond” implies a secure, interest-bearing asset issued by a government or company. Explaining Ethereum’s staking mechanism requires a lot of basic knowledge, making the narrative difficult for people who are not familiar with cryptocurrency.
David: While the analogy of ether as an internet bond resonates well in the crypto community, it requires too much prior knowledge for a wider audience. It’s a nuanced concept that works best with people who already understand Ethereum and decentralized finance.
ETH is programmable money
David: The second to last topic is "Programmable Money". This narrative was proposed by Eric @econoar in 2019, and it highlights Ethereum's capabilities in smart contracts. If Bitcoin is digital gold, then Ethereum is programmable money. It positions Ether as a dynamic, feature-rich asset. This narrative is concise and effective, pointing out the programmability that Bitcoin lacks.
Ryan: While the “programmable money” narrative is appealing, it lacks the depth to convey Ethereum’s full potential. It doesn’t necessarily mean an operating system, an app store, or a platform. Without additional context, it can seem like a single asset with if-then statements that ignore the richness of the Ethereum ecosystem. In my opinion, while the app store analogy isn’t entirely accurate, it feels more comprehensive and appealing.
ETH is a super-robust currency
David: We are approaching the final narrative, which I believe is the weakest: ETH is Ultra Sound Money. This narrative is popular in the Ethereum community, especially among those who like to make fun of Bitcoin enthusiasts. It originated from a period when the cryptocurrency world was mainly divided between Bitcoin and Ethereum, with few other important players.
The term "super sound money" was coined to contrast with Bitcoin's "sound money" narrative. It was a clever joke among crypto insiders that highlighted Ethereum's evolving monetary policy and its potential as a store of value. However, this narrative was not popular outside the crypto community. It was designed to be used within the industry and was not effective for marketing ETH to traditional financial audiences, such as investors at BlackRock, or even your parents.
Ryan: Exactly. This meme emerged during the 2019-2020 cryptocurrency wars and gained traction in 2021 as a reaction to criticism from Bitcoin supporters. They argue that Ethereum's ability to change its supply makes it similar to fiat currency, suggesting that it is less reliable as a store of value. Bitcoin supporters claim that ETH is only useful as a gas to pay for computations, while Bitcoin is the true store of value.
As Ethereum’s monetary policy solidified, the “super sound money” meme highlighted ETH’s potential as a store of value. However, it remained an inside joke that was deeply debated in the cryptocurrency community. It was not a narrative that resonated with people outside the cryptocurrency community or effectively communicated the value of Ethereum.
David: Exactly. For those who are not deeply involved in the world of cryptocurrency, the term "super sound money" is both confusing and meaningless. It is a relic of internal debates in cryptocurrency and does not lend itself to wider promotion.
Ryan: Agreed. This narrative is too closed-ended to be useful in convincing traditional finance audiences or new investors about Ethereum’s potential. It’s an interesting piece of crypto culture, but not a practical strategy for reaching the masses.
David vs Ryan: A 60-second sales pitch
David’s sales pitch: Ethereum is similar to Bitcoin, but with added programmability, which is a game changer. This programmability makes Ethereum not just a scarce digital asset, but a fully online digital economy platform. Ethereum’s programmability enables it to be a platform for financial applications, similar to how the App Store and Google Play Store are developer platforms for consumer applications, the Ethereum blockchain is a developer platform that allows for the creation of consumer financial applications that Wall Street is familiar with, such as exchanges, banks, marketplaces, lending services, and asset creation.
Since Ethereum is an internet-based protocol, it has internet-scale distribution. Applications on Ethereum are accessible to anyone with an internet connection, making them some of the most widely used and fastest-growing financial services applications ever. Demand for these on-chain applications generates $2 billion to $3 billion in revenue per year for the protocol, which Ethereum converts into share buybacks for its native currency, ETH. This significantly impacts the available supply of ETH on the secondary market, making it very sensitive to marginal demand. If you are optimistic about the growth and adoption of cryptocurrencies and blockchain technology, a Bitcoin ETF does not provide the exposure you need. What you need is an ETH ETF.
Ryan’s sales pitch: Bitcoin is just one asset, just Bitcoin. Ethereum covers every possible asset, so which is broader: gold or all the assets in the world? Bitcoin was designed to protect one asset, Bitcoin itself, while Ethereum is a general platform designed to protect all other assets: stablecoins, loans, stocks, bonds, derivatives, everything in finance. This is called “tokenization.” For example, Larry Fink said that every stock, bond, and asset will be tokenized on the global ledger, but even he is thinking too small. Tokenization is not just about assets of the past; it is about assets of the future - AI computing, personal data, social status, and celebrities, everything will be tokenized!
Ethereum is a global computing network for tokenizing and programming any asset, adding property rights to the internet. While tokenization can happen on other platforms, Ethereum is positioned as the strongest contender to ride the tokenization wave. There are 100 million Ethereum holders and 100,000 developers actively contributing to the code. Ethereum has already processed more transactions than the Visa network, and it’s only the beginning.
Ethereum’s cryptocurrency, $ETH, has investable economics, including an algorithmic buyback and dividend program, generating billions of dollars in earnings per year for ETH holders. This will only grow as the network expands. You can build a discounted cash flow (DCF) model for ETH just like you would for any stock, like Nvidia. And because ETH is as extremely secure and decentralized as Bitcoin, more and more people are looking at ETH as a complementary store of value to Bitcoin. While Bitcoin has a higher certainty of supply, Ethereum pays dividends and is deflationary, while having upside potential for the entire token economy. Bitcoin is exposure to digital gold; Ethereum is exposure to everything else. I own both, but if I could only choose one, I’d pick the bigger one — I’d pick ETH.
David and Ryan's mutual analysis and evaluation
David's version:
Strengths: The pitch emphasizes Ethereum’s programmability and its role as a platform for financial application development, comparing it to the App Store and Google Play Store. This analogy works well for a traditional finance (TradFi) audience that is familiar with technology platforms. The concept of an internet economy built on Ethereum and the revenue generated by its applications is a strong argument.
Cons: This pitch may be too technical for certain traditional finance audiences who are not familiar with blockchain technology. The lack of simpler, more relevant terms like “tokenization” may be a missed opportunity.
Ryan's version:
Strengths: The pitch effectively uses Bitcoin as an anchor to make Ethereum’s broad potential easier to understand. The emphasis on tokenization and its future applications helps paint a vision of Ethereum’s capabilities. The pitch also includes specific metrics, such as the number of users and developers and transaction volume, which provide tangible evidence of Ethereum’s growth.
Cons: The copy may spend too much time on tokenization, which may confuse the audience about the concept. While the phrase “everything else” is powerful, it may lack the specificity to fully convey Ethereum’s potential to a traditional finance audience.
