$1,000,000,000 Crypto Fund Moves To Bitcoin And Two Ethereum Rivals As A New Big Risk Is Emerging, CIO Says
Valkyrie Investments chief investment officer says that crypto asset managers are turning to safe-haven assets like Bitcoin (BTC) as The Merge approaches.
In a new interview with Bloomberg Technology, Valkyrie CIO Steve McClurg says that as Ethereum (ETH) prepares to transition to a proof-of-stake consensus mechanism in September, the crypto asset manager will leave it all. its position in the field of second largest digital assets.
McClurg said Valkyrie, which has around $1 billion in assets under its management, is moving its funds to Bitcoin and other smart contract blockchains like Avalanche (AVAX) and Zilliqa (ZIL).
“Right now, Bitcoin is really a safe haven for a lot of our funds… some more established proof-of-stake protocol is also a great place. Places like Avalanche and Zilliqa…
So we're really moving away from anything with too much exposure to ETH right now until we see this consolidation in [mid] month 9 and into some larger places more secure crypto protocol. “
McClurg said that Ethereum’s upgrade to a proof-of-stake consensus mechanism comes with trade-offs that could pose major risks for investors.
“I don't necessarily think the move to proof of stake is a great thing for Ethereum in the short term. In the long run, it might actually work.
But the Ethereum network is actually more secure as a proof of work. What really makes Bitcoin the most secure network is the long period of time through proof of work, you basically have a computer or a validator, which is validating transactions around the world in such a way that decentralized. When you move to proof of stake, that really falls into the hands of a few. "
The CIO also said that the security of Ethereum after the Consolidation will have to prove itself before investors holding large amounts of money on the network can feel safe.
“But considering it. about [how] Ethereum works, then we need to look at security, how it works, because we really think that if you're holding a multi-million dollar NFT and you're relying on the Ethereum network and it's changing right now, that might not be a great place right now.”
Featured photo: Shutterstock / MR.Somchat Parkaythong
Aug 26, 2022