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Renowned Bitcoin maximalist Fred Krueger has ignited controversy with his latest critique of Ethereum (ETH), claiming the second-largest cryptocurrency is “in a death spiral.”
In a Tuesday tweet, the early BTC investor laid out his reasoning, criticizing Ethereum’s financial model and questioning its long-term viability. Notably, the pundit pointed out that Ethereum’s current fee revenue, amounting to $73 million annually, is insufficient to cover the network’s inflation, let alone justify its market cap of $300 billion. The analyst further argued that a more realistic valuation for ETH might be closer to $3 billion, suggesting that even this figure might be overly generous.
Krueger further contrasted ETH’s model with Bitcoin, stating that BTC “derives its value from hard proof of work (just like gold)” and is “itself money.”
“None of this applies to Bitcoin, which is itself money and which derives its value from hard proof of work (just like gold). Buy Bitcoin. Sell ETH. Be happy,” he stated.
Krueger’s comments come in the wake of reports showing Ethereum’s daily revenue has plummeted to a 2024 low, down over 90% year-to-date.
This decline has added fuel to the fire for critics, who believe that Ethereum has worsened since the Merge upgrade. Notably, some observers have raised concerns over the rising transaction costs, especially on Layer-2s, and the substantial expenditures by the Ethereum Foundation to maintain operations as evidence of its ongoing struggles.
That said, the latest comments continue a pattern of criticism from Krueger, who has consistently advocated for Bitcoin’s superiority over other cryptocurrencies. In June, the pundit made a comprehensive critique of the top 19 cryptocurrencies like ADA, SOL and ETH, calling these altcoins “really jokes” while advocating for a Bitcoin-only approach. At that time, he highlighted issues such as Ethereum’s declining trend against Bitcoin and ongoing legal battles with the SEC.
Notably, Krueger’s stance aligns with other prominent Bitcoin maximalists like Max Keiser, who in the same month predicted that “ETH [is] Heading to Zero Against Bitcoin.” Keiser argued that Ethereum lacks commodity status and true decentralization compared to Bitcoin.
However, not everyone in the crypto space agrees with these maximalist views. In an interview earlier this year, Cardano founder Charles Hoskinson likened Bitcoin to a “religion” rather than an “ecosystem”, warning that the network may eventually lose its market position. Hoskinson compared Bitcoin to Windows, arguing that like Microsoft, it may stop innovating and lose ground to more dynamic competitors.
“Bitcoin needs the industry to survive…it needs all these exchanges and all the other infrastructure because it’s not self-sufficient. [Its] going to have to grow and adopt to change if it wants to survive.” Said Hoskinson.
Nermeen Nabil Khear