ZACK GUZMAN: Well, in today’s “Crypto Corner” we are focusing in on Ether as we’re watching that cryptocurrency pop a bit today around the $3,200 level. If you’ll remember back in January when Ether was trading close to about $1,200 bucks, our next guest predicted that we could see the mid $3,000s next, and lo and behold we hit exactly that just a few months later. So where could prices go from here?
Let’s bring her back in to find out. A pleasure to welcome back into the show Megan Kaspar, Magnetic managing director joining us right now. Megan, you know, last time you were on with us we were talking about Ether potentially hitting $10,000 by the end of the year. We came down maybe a little bit from the all-time highs we saw earlier, but are you sticking by that 10K call?
MEGAN KASPAR: Hey Zack, yeah I am. You know, when we look at it in two dimensions from supply and demand, investors are still using crypto as a favorite tool for hedge against inflation as the US may or may not be continuing to print infinity amount of US dollars, so it’s a great tool against the deflation aspect.
And then also– well, Ethereum is becoming a deflationary asset. So you have Bitcoin which is sort of this fixed asset and then Ethereum– like I said on our last call– we have to do network upgrades, one of which has already been initiated on June 5th which basically changed the mining fees on the network.
And then towards the end of the year, beginning of next year, we’ll have about a million worth of Ethereum coming out of supply. So that will initiate it becoming a deflationary asset. And yes, that’s why we’re looking at it. The 8 to 10 price call is still very much a possibility.
ZACK GUZMAN: Yeah. So much of that is changing now, and you think back to when people were still thinking about there’s no fundamentals here in crypto. Obviously, I think 2021 has proved that wrong– 2020. A lot more people maybe jumped on the bandwagon here.
But when you look at it, NFTs are kind of hard to not bring up when we look at what’s going on on Ethereum, the network itself, because just the number’s are pretty staggering to highlight. In August we hit record levels of people spending money on these NFTs and it’s still being debated whether or not there’s actual value in these things. A lot of people comparing them to Beanie Babies and things like that. But you can’t really not focus in on that when you see that much money flowing into it.
So what’s your take there in terms of whether or not that’s kind of supportive of Ethereum pricing, too, here if that’s what all this is priced in?
MEGAN KASPAR: Major support. Just in August alone we had $900 million worth of NFT sales on Ethereum. All of this NFT community has really proliferated crypto as an asset class, but the community itself is pretty new just as of 2021 and I think we’ll continue to see that expand as the real world applications for NFTs come alive in immersive, insurable, interactive ways.
ZACK GUZMAN: Yeah, I mean just maybe to back up because some people watching might be confused by what NFTs even are. You know, non-fungible tokens, it can include a lot of things. Maybe something with use cases when we think about collectibles that can give you access to events, but also it includes– this particular one here. We’ve talked about Ether rocks– basically a clip art of a rock– and that one there sold for more than $1.7 million. So sometimes this is pretty crazy, Megan. But, I mean, it’s all looped into that you. This is where the money is going. I mean, are you kind of surprised the new projects that have popped up or how are you seeing that kind of evolve now?
MEGAN KASPAR: No, I mean, we’ve had just in the last month alone 19 different NFTs sell for over a $1 million. So I think we’ll continue to see this as the younger generation feels comfortable buying and owning assets that are not physical, and that, again, is sort of the tech trend that we’re moving towards in dematerialization.
And that, again, is another reason why this asset class will continue to grow. We’re only at a $2 trillion market cap right now. Back in January on our call we were at $1 trillion. And like I’ve always said, I believe in the next few years we’ll be at a $10 trillion market cap.
ZACK GUZMAN: Well, you haven’t been wrong yet so it’s hard to kind of disagree with the things that you say on the show. But when you look at maybe if people don’t want to get into specific NTFs– I know you’ve talked about certain chains maybe levered more towards where NFTs could go if that really does start to take off. Wax one of the projects you mentioned your co-founder at Magnetic also behind. I mean, talk to me about maybe that’s the best play to play this space if you don’t really want to own them specifically or maybe what the advice would be to new investors coming on board.
MEGAN KASPAR: Wax is a great platform. So is Binance. There are a lot of other chains that are creating communities around NFTs and I think that if you’re a part of this creator economy and launching an NFT, the best advice would be launch your NFTs on every chain because not all the chains are interoperable yet.
And if you’re a trader, you know, follow the trends. Get into the Discord channels. Get into the Twitter accounts of the top NFT traders. This is really the best way to follow the community. These kids are living in the metaverse and trading and creating an entire new way of commerce all in this ecosystem.
ZACK GUZMAN: One last question, too, for me. I mean, we’ve seen kind of everything move, I guess, in tandem in the past, but now finally some cryptos kind of breaking from the trends. Even when Bitcoin’s down you might see some other side projects start to take off. I mean, where do you think we are in terms of the cycle of maybe institutional money now starting to shift away?
We’ve seen a lot of funds pop up here focusing in on more fringe projects, if you want to call them that– I’m thinking Solana– and maybe some of the other things that are getting built out now. I mean, how fast is that, maybe, institutional side quickly changing here in 2021 when we thought about maybe an ETF getting approved but now people focusing in on some more niche products?
MEGAN KASPAR: Well, those bigger macro things are still happening. You know, $17 billion of VC capital has gone into crypto projects and I think it’ll sort of trickle down. It’ll have a top-down effect. The larger institutions and the ultra wealthy becoming more involved in the space, and as people become more aware they’ll gain exposure into other smaller assets and chains which will help grow those ecosystems.
When you look at Solana, Cardano, Binance, these ecosystems have all experienced over 2,000% returns this year alone, which is higher than Bitcoin and Ethereum. So, yeah, I suspect that we’ll see this proliferate.
ZACK GUZMAN: Yeah, it’s kind of tough to ignore as they continue to take off here this year. We didn’t talk about Doge, though, so there is that. But Megan Kasper, Magnetic managing director, appreciate you coming back on. We’ll keep our eyes on that 10K price target and have you back on and check in, but thanks again for the time. Have a great week.