Should You Follow the Lead of Billionaire Peter Thiel and Invest in Ethereum?

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In the past three months, the world’s second-largest digital currency, Ethereum (ETH), has sprung back to life, nearly doubling its value. Over the last thirty days alone, its price has skyrocketed by an impressive 56%.

It’s not unexpected that affluent investors are seeking opportunities to invest in Ethereum, and one such example is billionaire tech entrepreneur Peter Thiel who recently acquired a 9% share in Bitmine Immersion Technologies (BMNR), a company focused on amassing as much Ethereum as possible. This raises the question: should you too consider investing in Ethereum?

The upside potential of Ethereum

Over the first few months of the year, I found myself on the sidelines when it came to Ethereum, as it struggled alongside other major cryptocurrencies. But the last couple of months have been nothing short of exhilarating! A series of pivotal events have unfolded: the approval of new crypto legislation in Congress, the much-anticipated initial public offering (IPO) of stablecoin issuer Circle Internet Group (CRCL), and Robinhood Markets’ (HOOD) innovative foray into stock tokenization. These developments have certainly reignited my interest in Ethereum!

Each of these occurrences, although they don’t specifically affect Ethereum, are extremely encouraging developments for the long-term trajectory of the Ethereum blockchain. For instance, new stablecoin regulations could significantly expand the influence of stablecoins within the U.S. economy, and it just so happens that Ethereum is the dominant platform for stablecoins. Similarly, upcoming crypto market regulations might erode the distinction between traditional finance and decentralized finance (DeFi), and once again, Ethereum stands out as the leading blockchain for DeFi applications.

Notably, the unique business strategy of Ethereum treasury companies, where a firm abandons its previous operations and instead raises funds from investors to amass substantial quantities of Ethereum, has recently gained widespread acceptance. In the past month alone, no less than three publicly traded corporations have adopted this approach.

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In just two short months, a relatively obscure Bitcoin mining firm called Bitmine Immersion Technologies has burst onto the scene. They’ve managed to attract Wall Street strategist Tom Lee as their chairman, rake in over $250 million from investors, and are now being compared to MicroStrategy (MSTR) in terms of Ethereum. Their stock price has skyrocketed an astonishing 900%, thanks largely to the implementation of the Ethereum treasury company model.

Discussion currently revolves around Ethereum potentially reaching $5,000 by the summer’s end and $15,000 by year-end. Some experts even predict it could surpass $30,000. Given such significant growth potential, it’s unsurprising that Thiel (through Founders Fund) is currently investing in Ethereum. The potential benefits seem too substantial to overlook.

Different ways to get exposure to Ethereum

It’s worth noting that Thiel isn’t acquiring Ethereum in a straightforward manner or indirectly through an Ethereum exchange-traded fund (ETF). Instead, he’s opting to invest in Bitmine Immersion Technologies, a publicly listed company, which acts as a representative stock for his Ethereum holdings.

In a similar fashion to MicroStrategy (formerly known as Strategy), prior to the debut of the new spot Bitcoin Exchange-Traded Funds (ETFs) last year, individuals were investing in this entity to gain exposure to Bitcoin. This was due to the fact that Strategy held such a significant amount of Bitcoin on its balance sheet that it essentially functioned similarly to owning a spot Bitcoin ETF.

In contrast to the current situation where Ethereum ETFs have been created, eliminating the necessity of a proxy stock. One might wonder then, why Elon Musk is opting for Bitmine Immersion Technologies as his preferred method of investing in Ethereum?

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Thiel seems to be aiming for a similar level of market success as Strategy, which has seen an astounding 3,517% growth over the last five years. This performance even surpasses that of Bitcoin during this timeframe. Many believe that crypto asset management companies could significantly outshine the very cryptocurrencies they are amassing.

Is Ethereum worth the hype?

Keep in mind that there is currently much excitement and anticipation about Ethereum. The expectation is that Ethereum could make a significant shift towards stablecoins, DeFi, and tokenization. This change might propel its cryptocurrency value significantly, with associated companies in the Ethereum treasury being swept along for the ride on a meteoric trajectory.

However, it’s essential to note that blockchains like Ethereum are not corporations. Instead, they are highly decentralized entities, with a vast international network of developers working together to drive their progress. This means that there’s no certainty that Ethereum will capitalize on its current momentum.

Vitalik Buterin, one of Ethereum’s co-founders, has repeatedly emphasized his desire for Ethereum not to transform into a “gambling den” driven by unbridled greed and fueled by Wall Street speculation.

Maintain a realistic outlook regarding Ethereum’s potential. Although Ethereum is nearly there, it’s approaching a new record high of $5,000, achieving substantial growth beyond this level would require numerous favorable conditions to align.

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2025-07-24 15:42