Ethereum Compared to ’Amazon in the 1990s’ as Investors Await its True Potential, Says 21Shares
Ethereum, often likened to Amazon in its early days, may be on the brink of surprising Wall Street with untapped potential, according to Leena ElDeeb, research analyst at crypto asset manager 21Shares. Like Amazon in the 1990s, Ethereum is seen as complex yet full of promise, waiting for broader investor recognition before it can scale to its full potential.
While spot Ether (ETH) ETFs launched in July, they’ve attracted modest inflows compared to the spot Bitcoin (BTC) ETFs. Analysts suggest that institutional adoption will accelerate once Ethereum’s potential becomes clearer. “Ethereum is like Amazon in the 1990s,” said ElDeeb, emphasizing its foundational role in decentralized finance (DeFi) and blockchain-based applications.
Federico Brokate, head of 21Shares’ U.S. business unit, noted Ethereum’s significant growth from a platform supporting basic smart contracts in 2015 to one that now powers over $140 billion in DeFi applications. “Just as Amazon evolved beyond books to transform retail and cloud computing, Ethereum may also unlock revolutionary use cases we can’t fully envision today,” he stated.
One clear advantage for Ethereum is its network of over 200,000 active developers — a talent pool that dwarfs Amazon’s workforce of 7,600 in the late ’90s. Brokate believes that as the ecosystem grows, Ethereum’s impact on global finance could parallel Amazon’s evolution into a tech giant, which now employs over 1.5 million people.
Ethereum’s rising influence is visible with financial giants like BlackRock and UBS tokenizing assets on the network, while firms like PayPal and Visa are building on its infrastructure. Despite competition from other layer-1 solutions, Ethereum remains dominant in DeFi and real-world asset markets. However, as ElDeeb observed, “only a few investors fully grasp Ethereum’s potential,” with many cautious about investing in spot Ether ETFs until use cases are more established.
For now, inflows to Ether ETFs represent only about 9% of what Bitcoin ETFs achieved in their first 90 days, partly due to limited marketing, lingering regulatory questions, and U.S. restrictions on staking, according to Katalin Tischhauser, head of research at Sygnum Bank. However, she suggests this could change in the coming year as more investors recognize Ethereum’s long-term value.
Despite Ethereum’s current revenue challenges from layer-2 scaling, Brokate remains optimistic, likening Ethereum’s early-stage growth to Amazon’s unprofitable years in the 1990s. He expects fees from layer-2 solutions to eventually boost mainnet revenues, supporting Ethereum’s sustainable growth as the network scales.
Featured image from: cointelegraph.com