Is Ethereum expected to replace Wall Street's settlement system? Executives warn: investors are seriously underestimating it.

SharpLink CEO Joseph Chalom and EigenLayer founder Sreeram Kannan recently stated that the market has yet to reflect the potential of Ethereum (ETH) replacing Wall Street's outdated settlement infrastructure in its price. They believe that as institutional adoption accelerates, the emergence of Ethereum ETFs, and staking and DeFi yields gain recognition from more asset management companies, the long-term value of ETH may be severely underestimated.

The Inefficiency of Traditional Finance and the Advantages of Ethereum

Chalom pointed out in the Milk Road podcast on September 15 that the current Wall Street settlement system has multiple frictions: trades take a whole day to settle, create counterparty risks, require overnight financing collateral, and intermediaries charge high fees.

In contrast, Ethereum's atomic settlement can complete transactions in seconds, eliminating counterparty risk and operating in a decentralized manner. He compared Ethereum to a "new type of public infrastructure," similar to the internet during the Web1 era, gradually becoming a universal settlement layer for global finance and economy.

Programmable Finance: The "Winning License" for Institutions

The smart contract functionality of Ethereum allows asset allocation, dividend distribution, and portfolio rebalancing to be reduced from days to minutes, and supports combinable trading across assets.

Chalom believes that this efficiency enhancement creates a "license to win" for institutions, allowing them to stand out in competition. Kannan describes Ethereum as a "verifiable trust platform," replacing traditional institutional guarantees with cryptographic verification, which can extend to non-financial fields such as AI agent verification, prediction markets, and autonomous systems.

EigenLayer and Cross-Network Support

Kannan added that EigenLayer technology allows Ethereum to provide security and settlement support for other networks, extending its influence beyond the foundational protocol. He emphasized that "verifiability is the foundation of society," and Ethereum's architecture is perfectly suited to become the core of this trust layer.

Institution Adoption and Capital Inflow Turning Point

Chalom pointed out that, compared to Bitcoin (BTC), Ethereum's value proposition requires more explanation at the infrastructure level, but once institutions understand its potential, the conviction will be stronger.

The Ethereum ETF set to launch in July 2024 has become a turning point for adoption, with the amount of ETH held by asset management firms reaching between $14 billion to $15 billion. He predicts that as institutions recognize the characteristics of ETH as a productive asset (stake yield, Decentralized Finance yield), the accumulation rate of Ethereum will surpass the growth of Bitcoin holdings in Strategy.

Conclusion

Ethereum is transforming from a "cryptocurrency" to a "global settlement infrastructure", with its scope of application far exceeding investors' current pricing perceptions. With regulatory clarity, the launch of ETFs, and accelerated institutional adoption, ETH may be entering a period of valuation reassessment. For investors, this could be a golden opportunity for early positioning.