Investment advisor Two Prime is ditching Ethereum over its memecoin-like behaviour and underwhelming price performance. The SEC-approved firm says it will double down on Bitcoin (BTC) while conducting a post-mortem on Ethereum.
Two Prime Drops Ethereum Over Memecoin Behaviour
SEC-approved investment advisor Two Prime has called it quits with Ethereum following a raft of negative fundamentals and on-chain metrics. According to a company statement, the derivatives firm will focus its attention on Bitcoin, cutting ties with Ethereum after six years.
The firm operated Two Prime Lending, rising to become the second-largest lender for ETH and BTC-backed loans. Rather than dabble in other cryptocurrency-backed loans, Two Prime stuck with BTC and ETH, given their deep liquidity for institutional action.
After enjoying modest success with Ethereum for six years, Two Prime says it is moving away to focus on BTC lending. The press release reeled out a laundry list of reasons behind the company’s decision to ditch Ethereum for Bitcoin.
“ETH’s statistical trading behaviour, value proposition, and community culture have failed beyond a point that is worth engaing,” read the statement. “The risk-reward is simply unjustifiable at this point with BTC available as an alternative.”
Right out of the bat, Two Prime says ETH behaves like a memecoin rather than a predictable asset. The report notes that ETH displayed “multi-standard deviation moves” following a de-correlation from Bitcoin in Q1 2025. The Ethereum-to-Bitcoin ratio has sunk to its five-year low given ETH’s underwhelming price performance in 2025.
A Raft Of Reasons Behind The Company’s Decision To Ditch ETH
Apart from its memecoin behaviour, Two Prime notes that the Ethereum price has not flashed any signals of a rebound after the slump. The firm notes that investors are not buying the dip, demonstrating a lack of apathy for the largest altcoin.
Two Prime notes that Bitcoin ETF inflows have surpassed ETH by nearly 24 times, signaling a decline in institutional interest. Furthermore, the firm points to a shoddy business model that allows Ethereum layer 2s to snag a chunk of its monetization.
Rising competition from Solana and other emerging blockchains is taking a large chunk of Ethereum’s market share. Two Prime argues that Ethereum suffers from strong leadership and is a victim of its early success, but has failed to change with the times. An expert has warned that Ethereum is in danger if it does not scale by 100X in the next five years.
“The existing scale of the asset and the remaining upside of global adoption make BTC a far better risk-weighte investmen than ETH,” read the statement.
Two Prime’s decision to offload its ETH holding has seen prices tumble by nearly 2% since the announcement. Previously, Galaxy Digital has offloaded a portion of its ETH holdings to accumulate SOL, adversely affecting price performance.
The post Two Prime Abandons Ethereum For Bitcoin, Tags ETH As A Memecoin appeared first on CoinGape.
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Justin Bons, the founder and chief investment officer of European cryptocurrency fund Cyber Capital, has once again criticized the operations of Ethereum L2 solutions. In a recent X post on Saturday, Bons tagged these blockchain platforms designed to improve the scalability of the Ethereum network as dangerous with the capacity to cart away users’ funds unchecked.
Ethereum L2 Centralized Design Poses A Problem?
According to Justin Bons, most major Ethereum L2 solutions are centralized, with single servers often being responsible for running the platform’s operations. The Cyber Capital CIO states that this design which goes against the cypherhunk principle of decentralization and security, can be considered harmful to investors as these chains can collapse at any moment due to a singular event or even be manipulated to steal users’ funds.
In backing these claims, Bons made reference to Consensys’ zkEVM Roll-up network Linea whose management on June 2nd, 2024, initiated a pause in block production due to a bug in the platform’s smart contract.
The acclaimed crypto researcher also highlighted when the Optimism chain underwent a 2-hour downtime on February 15th, 2024, due to a bug in the network’s centralized sequencer. In addition to these examples, Justin Bons’ report also included similar incidents with other Ethereum L2 solutions such as Starknet, ZkSync, Arbitrum, and Polygon, all of which can be traced to the centralized nature of these projects.
The Cyber Capital founder expresses significant opposition to these L2 solutions, stating they do not offer the same level of security and stability as the main Ethereum network. In addition, he states while an adverse scenario such as loss of user funds is yet to occur, the fact that such potential exists is highly concerning.
Interestingly, these statements follow previous claims by Bons that Ethereum had formed a parasitic relationship with L2s whereby these platforms now almost run independently of the main network, with significant control over liquidity and other factors crucial to the Ethereum ecosystem.
Ethereum Poised For Further Price Decline
In other news, popular crypto analyst Ali Martinez has postulated that Ethereum may yet maintain a downtrend for the time being. Notably, the prominent altcoin produced an underwhelming performance in August losing 22.36% of its value. According to the MVRV momentum (180-day), which measures the change of the market value to realized value ratio over 180 days, Ethereum still appears largely overvalued. Therefore, its downtrend is likely far from a reversal.
At the time of writing, the second largest cryptocurrency exchange hands at $2,500 with a slight loss of 0.99% over the last day. Meanwhile, the asset’s daily trading volume has declined by 55.75% and is valued at $6.85 billion.
Featured image from Forbes India, chart from Tradingview
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Bitcoin price action on monthly timeframes has made a historic move to the touch the lower Bollinger Band – a popular technical indicator and volatility measuring tool.
Although he warns there isn’t yet a sign that a bottom is in, the tool’s creator says where price action tapped is a “logical” level for such a bottom to occur.
Unprecedented Bitcoin Price Action Taps Monthly Bollinger Band For First Time In History
Expectations for Bitcoin price in 2022 were closer to $100,000 per coin and above. Yet the top cryptocurrency today is trading close to its former 2017 all-time high at $20,000.
But unprecedented macro conditions has caused unprecedented price action in Bitcoin and other cryptocurrencies. Never in the past has the top cryptocurrency by market cap retested its former all-time high this way.
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And never did Bitcoin price on monthly timeframes ever reach the lower Bollinger Band. But that’s exactly what happened this past month when crypto market contagion spread and brought asset prices down considerably.
BTCUSD monthly touches down on the lower Bollinger Band | Source: BTCUSD on TradingView.com
Touching the lower Bollinger Band, however, could be a logical place for a bottom according to the tool’s creator.
Time To Pay Attention: John Bollinger Points Out Logical Level For Potential Bottom
The Bollinger Bands are a technical analysis tool that can help to measure and predict volatility, or find areas of potential resistance and support. It was created in the 1980s by John Bollinger, who today is a frequent Bitcoin speculator. It relies on a 20-period simple moving average and a dynamic upper and lower band set each at two standard deviations.
Mr. Bollinger pointed out the touch of the lower Bollinger Band in a new tweet, where he suggests the area would be a “logical” level to bottom. Bollinger did warn, however, that there still aren’t signs of such bottoming yet.
In the past, Bollinger was able to call out the April 2021 peak by spotting a “three pushes to a high” bearish reversal pattern with striking accuracy. The analyst says his tools later confirmed what he says was an “M-type” double top.
Picture perfect double (M-type) top in BTCUSD on the monthly chart complete with confirmation by BandWidth and %b leads to a tag of the lower Bollinger Band. No sign of one yet, but this would be a logical place to put in a bottom.https://t.co/KsDyQsCO1F
— John Bollinger (@bbands) June 27, 2022
Bollinger also shared in his chart a look at ancillary indicator, B%, which also has set historical lows. Monthly Bollinger Band Width can be used to measure volatility, and still has room to fall compared to past cycles.
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Does Bitcoin price have more room to fall also? Or will a bottom form in this “logical” zone as the tool’s creator calls attention to? Either way, it seems to be “time to pay attention.”
Follow @TonySpilotroBTC on Twitter or join the TonyTradesBTC Telegram for exclusive daily market insights and technical analysis education. Please note: Content is educational and should not be considered investment advice.
Featured image from iStockPhoto, Charts from TradingView.com
Cardano and Solana are classified as commodities in the new bipartisan crypto law, stating that they are not entirely decentralized. It is the most significant crypto law ever proposed in the United States.
Cardano is now classed as a commodity, like with Solana and other coins. Cardano is more decentralized than Ethereum, according to the Twitter account ADA whale, which responded to the news. He also questioned the individual who would file the disclosures with the SEC.
The whale’s mocking response illustrates the new bill’s incapacity to properly examine different coins, implying that the bill could be a nuisance for Cardano and Solana developers and community members. On the other side, Senators Cynthia Lummis and Kirsten Gillibrand have introduced a bipartisan crypto bill.
The new crypto bill will include many significant frameworks
According to the measure, many coins will be regulated as commodities by the Securities and Exchange Commission. In addition, transactions under $200 are tax-free.
There will be more clarification on the taxation of mining and staking income as well. Self-custody wallets are protected under the new bill, which fixes the crypto broker law.
The measure also includes regulations for dealing with the stablecoin problem. Stablecoins should be fully backed, according to the new bill. This is crucial because, with the demise of UST and the terra ecosystem, trust in stablecoins appears to have waned.
The measure also addresses consumer protection and establishes a strong regulatory framework for cryptocurrency exchanges. While DeFi and NFT restrictions are not mentioned in the law, they may be addressed at a later time. If the measure passes, it has the potential to propel the digital asset sector ahead in the United States.