Joseph Lubin, the co-founder of Ethereum and CEO of Consensys, recently forecasted a potential bullish trend for Ether (ETH). He even claimed that its value would exceed the entire global GDP by a factor of 20. On June 19, Lubin came before the Commission to share his analysis. He maintained that Ether’s value needed to be commensurate with the value that Ether provided—it’s use in the fast-growing decentralized global economy. He posits that Ether's role extends beyond a mere digital currency, encompassing a "trust premium" layered atop its utility as "digital oil" for transaction fees. This accumulated demand, says Lubin, could soon be enough to drive Ether’s price to record high levels.
Ether as the Foundation of a New Economy
Lubin's valuation thesis is rooted in the concept of Ether as the backbone of a future "hybrid human-machine intelligence society." Most importantly, he believes that this new society will create tremendous value. That future value will be an astounding five times today’s $113.8 trillion global economy.
"If there was a magical trust-diamond commodity and you could apply chips of this diamond to every transaction, agreement or relationship … how much value would that add? 10 % to global GDP? 100 %? 1,000 %? … The ticker of that commodity is ETH.”" - Joseph Lubin
Lubin believes that the value residing on and flowing through the Ethereum network will constitute a significant portion of Web3, ultimately dwarfing today's global GDP.
Bitcoin as "Gold 2.0" and Ether's "Trust Premium"
In his analysis, Lubin separates Bitcoin from Ether and recommends valuing Bitcoin as “Gold 2.0.” He’s careful to note that Ether has its own “trust premium.” This premium extends to its function as “digital oil” for transaction fees. According to him, this “trust premium” comes from Ether’s function as a medium for fostering safe and transparent transactions across the decentralized network.
Taken together, these factors, according to Lubin, put Ether on a path to exponential growth, leading it to outpace any historical asset metric.
The State of Ether Today
As of today, over 35 million Ether are staked in proof-of-stake contracts, amounting to about 29% of the total supply. With a float above 120 million coins, Ether’s market capital is currently about $307 billion. These numbers further underscore record-high levels of adoption and confidence in the Ethereum network and its native cryptocurrency.
Lubin’s valuation thesis makes for an exciting picture for Ether’s future. He thinks its value can be much greater than the current consensus expects as the decentralized economy matures.
