Michael Nadeau, the founder of The DeFi Report who also helps startups and asset managers, has pointed out that Ethereum (ETH), the world’s largest smart contract platform, reached $10 billion in revenue “faster than any other major software company besides Google.”
Although this may be like comparing apples to oranges, because Ethereum functions a lot differently than a centralized software tech firms, Michael still mentions that this is, arguably, the “least interesting” thing about the ETH network.
Michael further noted that Ethereum’s computing infrastructure is “run by a distributed and global network of service providers. This is where the $10b was paid — not a centralized entity.”
He also noted via LinkedIn that Ethereum’s addressable market “is massive — in his opinion, it could one day serve as the global settlement layer for all of finance.”
From first principles, Ethereum is essentially “laying down a new data infrastructure for the internet.” He added that this new data structure functions “as a global accounting ledger that anyone can access, audit, provide services for, or build a business on top of.”
He pointed out that Ethereum currently “controls a roughly 80% market share amongst competing smart contract platforms.”
He continued by noting that Ethereum has “the strongest network effects in crypto. Its network value grows as the number of connected users increases (Metcalf’s Law). This is driven by a foundation of developers, developer tooling, programming languages, the EVM standard, token standards, wallets, applications, scaling infrastructure, and venture capital investment.”
He added that Ethereum is “the only crypto network that returns a positive real yield to holders of its native token, ETH. The yield earned by holders (who validate transactions on the network) is earned in the form of user fees.”
He further revealed that Ethereum has “over 111 million non-zero wallet addresses. It has over 800 thousand validators worldwide. And it has the largest crypto exchange in America (110 million verified users) building scaling solutions on it.”
Ethereum (and public blockchains broadly) are “introducing the concept of digital property rights to the internet. An abstract concept that has profound implications in the long-term.”
He also shared that Ernst & Young recently “launched a privacy-focused layer 2 network within the public Ethereum network — designed to onboard enterprises.”
Per Paul Brody:
“Ethereum is to business ecosystems as ERP is to enterprises” The team forecasts over 4 billion transactions per day for automotive supply chain use cases alone.
Michael concluded that Ethereum is scaling and “developing in a very similar manner as the internet did. YouTube, SaaS, Zoom, E-Commerce, and Social Media were not possible before broadband. Emerging layer 2 solutions are just gaining adoption which should enable a host of new applications previously unthinkable.”
The Q4 update of *The Ethereum Investment Framework* will be published next Wednesday. Michael noted.
He explains that they “cover these concepts as well as every important KPI/metric going back to network inception using data from Token Terminal — the leading onchain data provider for institutions.”