• Tom Lee draws comparisons between the present cycle of Ethereum and that of Bitcoin, when the latter increased 100 times.
• Critics base their arguments on the fact that ETH does not have a clear advantage over faster chains, including Solana.
• Whale records indicate that Bitmine purchased $234 million worth of ETH over the last seven days.

Tom Lee, the executive chairman of BitMine Immersion Technologies, believes that Ethereum (ETH) is about to start a cycle that will replicate the 100-fold run of Bitcoin. The argument he made evoked serious responses in the crypto community.

Ethereum Supercycle Analysis Draws Criticism

Tom Lee compared Ethereum’s current position to Bitcoin’s 2017 phase, when the leading cryptocurrency began its steepest long-term climb. He believes the same kind of growth is now forming for ETH, despite strong market fear.

The Fundstrat analyst also noted that Bitcoin endured six drops of over 50% and three declines of more than 75% during its supercycle. Lee warned that ETH investors will need patience. He said past cycles rewarded holders who sat through extreme conditions.

Lee cites that large price fluctuations do not indicate weakness. Lee argued that big price swings reflect a market already trying to account for ETH’s massive long-term potential. Nevertheless, his perspective was not accepted by many. They have cast doubt on the long-term supremacy and competitiveness of Ethereum.

Also Read | Ethereum’s Vitalik Criticizes Fake-Decentralized Apps in Latest Interview

Critics Lay Emphasis on Ethereum’s Weaknesses

The position was disputed by one top Bitcoin influencer (the Bitcoin Therapist). He said that Ethereum does not have a solid edge over smart-contract platforms, which are its competitors.

He asked what unique advantage Ethereum has that “hundreds of other coins don’t” and doubted that global financial markets would rely on Ethereum for 24/7 settlement.

Despite recent network upgrades, performance issues continue to persist. Competitors such as Solana are quicker and cheaper.

Whale Accumulation Strengthens Case for Ether Supercycle

However, decentralized finance, tokenized assets, games, and institutional applications of ETH will play a vital role in increasing its use. Base, Arbitrum, and Optimism are among the layer-2 platforms that are likely to contribute significantly to scaling the ETH network.

On-chain evidence seems to contribute to the analysis by Lee. Arkham data demonstrates that Bitmine Immersion bought over 67,000 ETH within the last week. The buys were from Galaxy Digital, FalconX, Coinbase, and other institutional brokers. 

The cumulative value of the transfers is more than $234 million. This is an indication of high conviction in the coin regardless of the weakness in the market. The purchase by Bitmine contributes to the argument by Lee that a supercycle is about to occur.  

Also Read | Ethereum Approaches Key Breakout Zone as Market Eyes $3,350 Level