Quick overview

---

Vitalik Buterin, a co-founder of Ethereum, endorsed Ether treasury companies but warned that if not managed carefully, the trend could turn into an “overleveraged game.’

Buterin said that the growing number of publicly traded companies buying and holding Ether is positive because it exposes the token to a broader range of investors, he stated in an interview with the Bankless podcast that was made public on Thursday.

Buterin said, “There are unquestionably worthwhile services being offered there.” He also mentioned that people have “more options,” especially those with “different financial circumstances,” when companies invest in ETH treasury firms instead of holding the token directly.

Bitcoin and Ether being the most popular, with billions of dollars raised, the so-called crypto treasury companies are a major trend on Wall Street. However, Buterin cautiously tempered his support, stressing that excessive leverage must not be the cost of ETH’s future.

Naturally, if you were to wake me up in three years and tell me that Treasury securities caused ETH’s downfall, I would assume they somehow turned it into an overly leveraged game. He described a worst-case scenario where a drop in Ethereum’s price led to forced liquidations, which then caused the token’s value to fall further and eroded trust

Buterin believes ETH investors are disciplined enough to avoid such a collapse. He mentioned the co-founder of the Terra blockchain, which crashed in 2022, and said, “These are not Do Kwon followers that we’re talking about.”

The market for publicly traded companies holding Ether has surged to $11.77 billion, with BitMine Immersion Technologies and SharpLink Gaming at the forefront. BitMine is the fourth-largest cryptocurrency holding among public companies, with 833,100 ETH valued at $3.02 billion..