When an ancient Roman General accomplished great deeds or bested a challenging enemy, the Roman Senate would award them a city-wide procession and festival called a Triumph. During the Triumph, the general would ride through the city in a chariot – displaying their spoils of war, parading captured enemies, and at the head of their army. Unknown to many, though, is that riding in the chariot with the general was the Auriga – who whispered a Memento Mori in the general’s ear through the procession. The memento reminded the general that he, too, would one day die and that he was no king – a stark reminder to not tempt fate or fall to hubris.

If you have followed crypto markets, the last six months have felt like Triumph for Ethereum. With the successful merge, Ethereum becoming partially deflationary and becoming a yield-bearing asset; the flippening seems assured. Thought leaders and crypto commentators are almost all bullish, and Twitter is full of bullish Ethereum threads. And yet, I find myself acting like an Auriga for Ethereum.

Here is what I whisper:

• Markets have priced in ETH yield, and it’s move to PoS.
• As transactions burn ETH, the deflationary meme depends on the health of its ecosystem – an ecosystem full of zombie protocols, inflating token supplies, resigning teams, under regulatory scrutiny, and with an unclear future.

ETH briefly turning inflationary – what happens to the meme?

• Moving to PoS may bring Ethereum under more regulatory scrutiny.
• New market entrants will probably look for a higher upside than the bloated vals of Ethereum DApps and ETH. Their attention and liquidity may go elsewhere.
• Relying on L2s for scaling is still new and untested and could go bad quickly if bridges keep getting hacked or some L2 suffers an exploit.

I am not overly bearish on ETH as an asset, but it gives me pause when everyone sings the same song and takes a premature victory lap. If everyone is bullish on ETH, I wonder if the market has already priced in all of it’s positive catalysts while all the positive catalysts for other chains have yet to be. I also think it important to check our biases and approach the ecosystem clearly. Ethereum has been doing well, but, it has a lot of challenges yet to overcome and it’s success is by no means certain.