The legendary cyberphunk Nick Szabo and Ryan Watkins, co -founder of Syncracy Capital, presented opposite frames to understand the Rallye d’Ethereum and its valuation mechanisms in a pair of X messages – and together, they read as a counterpoint on what really determines the prices of layer 1.
The price of Ethereum has nothing to do with usefulness
The main assertion of Szabo is clear: “A fundamental problem with the valuation of the ETH is that the main cases of use of Ethereum are largely external to the market value of the ETH. “According to him, Ethereum” can be very useful “, his applications” can generate important income “, and yet” ETH can always be at low prices – or vice versa – there is little link between them “.
He compares this with Bitcoin, whose main use case is that of a reserve of value, which is strongly linked to its price “, adding that” the basic design design is much more suitable for this use case, so the ETH cannot simply imitate it, it must rely on other cases of use poorly linked to its price. For Szabo, the problem is structural: the usefulness of Ethereum does not result in reliably by the capture of value by the ETH, while the objective and the price of bitcoin are closely linked by their design.
Szabo’s declaration, which returned to X at the end of September 2025 after an absence of five years, came in response to a question from Watkins. The researcher approaches the market from an opposite angle, saying that investors regularly overcome the layer 1 valuation models while the price and the story are making the work. “Most times, I see people too much thinking about the valuations of L1,” he wrote, describing the last stage of the ETH strength as a narrative pivot rather than a breakthrough in a spreadsheet.
Why has the price of ETH has tripled since April?
“The only difference between $ 1,400 ETH and $ 5,000 ETH was Bitmine.” In April, he said, “Ethereum was a dying platform”. Today, “it’s the Stablecoin channel and the next” bitcoin “type opportunity for institutions. The lesson he draws is brutal: “Price leads the stories, as they say”.
Above all, Watkins does not insist that these stories are justified – he underlines the void they fill. “The question here is not whether all this is justified. The fact is that the absence of agreed evaluation methodologies creates a vacuum that only the accounts and relative frameworks can fill.”
He presents the competing bullies not as convictions but as open hypotheses: “Does the bullish case of the ETH become a tax rate on world GDP? And if it became a programmable bitcoin ‘which, intrinsically, can not be valued? What about the two? The truth is that no one knows.”
This uncertainty, he says, pushes the markets to anchor themselves on comparisons and simple flows: “So, what happens when the market is more anchored on the relative value and the stories? Eh well, the BTC is worth $ 2,000 billion. So, which can say that the ETH should not represent 50 % of this? It offers a highness of features of Bitcoin, 500 billion dollars.
He rejects them as “wacky” exercises, but useful for navigation: “we can theorize as much as we want, or navigate the environment before us”. Until the fundamentals are recovered, “don’t think about it too much”. In its last line, it clearly defines the advantage: “There is a huge competitive advantage for the active ingredients that have penetrated the dominant consciousness and persisted over time. It is a game of flows and stories until the party stops.”
The two points of view can be true at the same time. The markets could continue to assess the ETH mainly through accounts and a relative value, while the question posed by Szabo – if the design of Ethereum can one day establish a lasting link between the usefulness of the network and the value of the token – remains unanswered. For the moment, the debate itself is the signal: the ETH crosses a cycle where the perceptions of the objective, and not only the measurable analogues of cash flows, set the tone.
When putting in press, the ETH was exchanged at $ 4,701.92.
Star image created with dall.e, tradingView.com graphic
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