Latest Ethereum price and analysis (ETH to USD)

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National Review

Welcome to the Capital Note, a newsletter about business, finance, and economics. On the menu today: the semiconductor shortage, funds considering new prime brokers, Amazon workers say no to union, and a look at the capital cycle. To sign up for the Capital Note, follow this link. Chip Shortage Since late last year, a shortage in computer chips has slowed production of everything from cars to video-game consoles, as semiconductor manufacturers struggle to keep up with growing demand. The shortage is so severe that President Biden has pledged to take action to boost output. Meanwhile, chipmakers are ramping up capacity, with Intel, Applied Materials, and Taiwan Semiconductors all projecting significant increases in capital expenditures over the next few years. The shortage has led to a rally in semis stocks, driving the PHLX Semiconductor Index up 17 percent for the year, well outperforming other technology verticals. However, the history of the semiconductor industry suggests investors should be cautious before buying into the sector. Computer chips perennially see volatile cycles, whereby supply shortfalls lead to excessive capital investment and eventual oversupply. Because manufacturers must project output at least nine months in advance, supply tends to lag demand, causing major fluctuations in investment and returns. In response to the chip shortage, Intel announced plans to enter the foundry business, producing chips designed by other businesses. Applied Materials, one of the sector’s best performers, is forecasting $85 billion in spending on fabrication equipment by 2024. As elucidated in Capital Returns: Investing through the Capital Cycle, “No part of the technology world has been more prone to cyclical booms and busts than the semiconductor industry. In good times, prices pick up, companies increase capacity, and new entrants appear, generally from different parts of Asia.” We are currently in the “good times” phase of the capital cycle, but analysts should be wary of extrapolating the good times out into the future. While the PHLX Semiconductor Index has skyrocketed of late, its performance before the COVID-19 pandemic has been highly volatile and weak overall. Some argue that this time is different. A recent Goldman Sachs note points out “severe supply tightness across a wide range of device types and the sense of urgency on the part of governments to re-design/onshore supply chains will support a cycle that is ‘stronger for longer’ compared to past upturns.” On this view, government support will lengthen the semis cycle, while fundamental changes such as reshoring weaken the link between growing capital investment and diminishing returns. Yet that sense of “urgency” could just as easily contribute to excessive capital investment, driving down returns for chipmakers. An analyst at Raymond James argues government intervention “could potentially lead to structural oversupply over time, which could depress industry profitability despite subsidies.” And while reshoring may be a boon to certain manufacturers, it is unlikely to benefit the industry as a whole. The much-discussed chip shortage is just an organic outgrowth of semiconductor cycle. Around the Web Hedge funds reconsider prime brokers after Archegos blowup Executives are weighing up whether to switch lenders they use as their prime brokers — banks that offer a range of services including stock lending, leverage and trade execution. The head of one London-based hedge fund said the firm had “initiated an internal process” to evaluate its prime broking relationships in the wake of the Archegos debacle. The top concern was reputation, particularly whether their clients believed they were “associated with the bad people” in the sector, the person said. Amazon Workers in Alabama Vote Against Forming a Union Amazon.com Inc. employees in Alabama voted not to unionize, handing the tech giant a victory in its biggest battle yet against labor-organizing efforts that fueled national debate over working conditions at one of the nation’s largest employers. An estimated 71% of the Bessemer, Ala., warehouse workers who cast ballots voted against joining the Retail, Wholesale and Department Store Union, according to the National Labor Relations Board, which on Friday finished counting all the votes that weren’t challenged. The federal agency has yet to certify the results but noted that the challenged ballots aren’t enough to exceed the vote margin against unionization. Random Walk Earlier we discussed the semiconductor cycle. Capital Returns: Investing through the Capital Cycle, a compendium of reports by Marathon Asset Management, explains how capital flows can influence returns at the industry level: Typically, capital is attracted into high-return businesses and leaves when returns fall below the cost of capital. This process is not static, but cyclical – there is constant flux. The inflow of capital leads to new investment, which over time increases capacity in the sector and eventually pushes down returns. Conversely, when returns are low, capital exits and capacity is reduced; over time, then, profitability recovers. From the perspective of the wider economy, this cycle resembles Schumpeter’s process of “creative destruction” – as the function of the bust, which follows the boom, is to clear away the misallocation of capital that has occurred during the upswing. High profitability loosens capital discipline in an industry. When returns are high, companies are inclined to boost capital spending. Competitors are likely to follow – perhaps they are equally hubristic, or maybe they just don’t want to lose market share. Besides, CEO pay is often set in relation to a company’s earnings or market capitalization, thus incentivizing managers to grow their firm’s assets. When a company announces with great fanfare a large increase in capacity, its share price often rises. Growth investors like growth! Momentum investors like momentum! Investment bankers lubricate the wheels of the capital cycle, helping to grow capacity during the boom and consolidate industries in the bust. Their analysts are happiest covering fast-growing sexy sectors (higher stock turnover equals more commissions.) Bankers earn fees by arranging secondary issues and IPOs, which raise money to fund capital spending. Neither the M&A banker nor the brokerage analysts have much interest in long-term outcomes. As the investment bankers’ incentives are skewed to short-term payoffs (bonuses), it’s inevitable that their time horizon should also be myopic. It’s not just a question of incentives. Both analysts and investors are given to extrapolating current trends. In a cyclical world, they think linearly. — D.T. To sign up for the Capital Note, follow this link.

Can Ethereum Overtake Bitcoin as a better store of value?

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Cryptocurrency never stops making the news headlines these days! And for good reason, as the bitcoin and cryptocurrency market price has soared over $2 trillion. That’s a lot of ‘money!

Earlier this week, BTC Maximalist and CoinDesk columnist Nic Carter predicted that Ethereum could overtake bitcoin.

Let’s face it, the majority of the working class can’t afford to buy even half a Bitcoin. Whereas the majority of people should be able to afford at least half or even a whole Ethereum coin.

Well, apart from Ethereum’s obvious affordability over Bitcoin, what else will drive it to overtake bitcoin?

Well, let’s turn to Billionaire Mark Cuban for some answers.

Laura Shin interviewed Cuban on her Podcast ‘Unchained’ about how Ethereum may be a better store of value than Bitcoin and this is what he said.

“I think the applications leveraging smart contracts and extensions on Ethereum will dwarf bitcoin. Bitcoin, right now, has evolved to be primarily a store of value, and it’s very difficult to use it for anything else. You really have to work a lot harder on bitcoin than you do on Ethereum.”

Cuban also explained that he expects Ethereum’s long-awaited 2.0 upgrade will spark the development of apps that “dwarf” bitcoin.

This prediction coming from a man who once said he’d “rather have bananas than bitcoin,” and claiming that crypto is “too complicated” shouldn’t be ignored.

However, the Dallas Mavericks owner has since befriended cryptocurrencies, praising the emerging decentralized finance space. The EDI is largely built on top of the second-largest cryptocurrency after bitcoin, which is Ethereum.

The price of bitcoin has famously soared around 700% over the last 12 months. And cryptocurrencies have continued to rise as Elon Musk continues with his somewhat comical tweets (which actually move the price of bitcoin) and super billionaire Jack Dorsey giving it their seal of approval.

Additionally, Wall Street giants have also begun rolling out bitcoin services, with Mastercard and PayPal hopping on the bitcoin bandwagon too.

Something that’s gained quite a bit of traction lately is that big Investors are worried that inflation may be on the brink of undermining the value of traditional currencies like the US dollar and this has further pushed interest into whether bitcoin can potentially counteract rising prices.

Cam Harvey, senior adviser to Research Affiliates and a professor of finance at Duke University seems to disagree with the former.

“Cryptocurrency’s history is too short to judge whether it can provide protection against rising prices.”

However, the huge bitcoin price rebound has been obscured by Ethereum and some other cryptocurrencies, with the Ethereum price adding a staggering 1,100% since April 2020.

Cuban expects that the coming upgrades to Ethereum, which aren’t expected for completion until at least the beginning of 2022, will “give some people a reason to use Ethereum as a store of value over bitcoin.”

Cuban also told Shin, and this perhaps outweighs in importance and clarity of what he said previously.

“In a few years, I think Ethereum and maybe two or three other blockchains will have their place, and those will be the winners,” Cuban said, adding that he’s not about to sell his bitcoin but that he does “own a lot more” Ethereum than bitcoin.

In the meantime, perhaps choosing a cryptocurrency to invest in should be based on your current financial circumstances and what you can afford to spend.

So, weighing up whether to buy bitcoin or Ethereum is largely a personal choice at this point.

According to Cuban, we may not know which of the two cryptocurrencies hold more value until at least 2022.

Any investment should always be backed up by proper research. Always consult a financial expert and research, research, research! You can never do enough personal investigation into where you’re investing your hard-earned money!!

Read more on Mark Cuban’s thoughts on Ethereum here.

Note: The author is not a financial expert, and this article is not intended to provide any financial advice. The exerts in this article were sourced from credible sources and senior financial experts in the Cryptocurrency field.

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The world’s most popular cryptocurrency on YouTube have been revealed in a study by Total Processing.

Although Bitcoin’s (BTC) price has surged by over 700% during the last 12 months, the cryptocurrency’s value has dropped nearly 4% since March 2021.

However, it’s a different story for Ethereum (ETH) with its price continually on the rise, increasing by 1,100% since April 2020. ETH is also gaining huge support by big-name investors like billionaire Mark Cuban who recently stated that he expects Ethereum’s long-awaited 2.0 upgrade to spark the development of apps that will “dwarf” bitcoin.

Whilst the media plays a part in the value and popularity of cryptocurrencies like ETH, YouTube’s role is just as significant. Ethereum has begun dominating platforms like YouTube, with ETH related news totalling over 231 million views on the platform to date.

Please find below our interesting data which includes the number of views each cryptocurrency has received on YouTube over the past year.