Home Markets The future is very bright for this Ethereum-based DeFi ecosystem, says InvestAnswers host

The future is very bright for this Ethereum-based DeFi ecosystem, says InvestAnswers host

The future is very bright for this Ethereum-based DeFi ecosystem, says InvestAnswers host

A popular crypto analyst compares a decentralized crypto exchange (DEX) to traditional financial markets (TradFi) in an effort to calculate its true value.

The anonymous host of InvestAnswers recount his 443,000 YouTube subscribers that he wants to see how decentralized finance (DeFi) platform Uniswap (United) compares to two traditional stock exchanges as well as the centralized crypto exchange Coinbase.

“Comparing Uniswap to TradFi exchanges. That’s how I do a lot of my reviews. I say, ‘What would that be worth in the real world?’

I shot the New York Stock Exchange [NYSE], Nasdaq, Coinbase and Uniswap. I took their market caps, took their earnings, and divided the market cap by the earnings and got different ratios.

The analyst notes that Uniswap, with a market cap of $6.7 billion versus $1 billion in revenue, is almost twice as expensive as the NYSE based on the metric. While Coinbase currently has a market cap-to-earnings ratio of 2:1, the host believes the major US exchange could face challenges in 2023.

“Uniswap at 6.7 is the most expensive using this very crude metric. Coinbase is actually the cheapest. Things like NYSE and Nasdaq are actually very profitable.

Coinbase could face profitability and revenue growth issues next year. That’s why it sounds, apart from all the other bad news and press he gets.

Source: InvestAnswers/YouTube

The InvestAnswers host believes that decentralized exchanges, in general, have held up well in the recent bear market and claims that Uniswap could eventually triple in value despite not being “the fastest horse” in the DeFi niche .

“Given the growth of DEXs and their popularity and how they have survived and thrived during this bear [market] winter, I think the future is very bright for Uniswap…

I believe DEXs are the future. [UNI is] 81% reduction from all-time high and a 54% drop in the last 12 months. The question is, could Uniswap do a 3x from here? I say, yes it could. But are there faster horses? Yes.

Will inflation lead to price compression? Yes. But could it 3x? Yes.

I do not own Uniswap. I did this last year, but not anymore.

At the time of writing, Uniswap is down 2.47% in the last 24 hours, trading at $8.27.


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Featured Image: Shutterstock/Jorm S


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