Ethereum companies that run on efficiency runs great risk: Sharplink CEO

In recent months, more and more companies in Ethereum (ETH) have been stepping. Sharplink Gaming was the first to set the tone and has already built up a large stock of the Altcoin. Yet there is a clear warning from the top for everyone who wants to enter their track.

Extra return goes hand in hand with extra risk

In a conversation with Bankless, Sharplink CEO Chalom said that so-called “Yield Chasing” at Ethereum companies can be dangerous. He is referring to companies that use their ETH stock to achieve as much extra returns as possible.

Sharplink Gaming, for example, earns a few percent interest by stopping all their Ethereum. All coins are secured in special smart contracts and are used to secure the blockchain network and process transactions.

The strike is a relatively safe way to grab extra returns, especially if you (like Sharplink) take the strings yourself.

According to Chalom, there are also ways to achieve double digits of returns. Then we are talking about the seas of possibilities in the world of Decentralized Finance (Defi).

But there are strong risks involved. He points to credit risk, counterparty risk, duration risk and smart contract risk. Especially companies that let board and try to make up for good, according to him, could take irresponsible steps.

“The greatest danger is that parties who take extra risks behind are not wise,” said Chalom. According to him, the entire sector can “infect” if unprecedented choices are made in capital structure or return models.

Sharplink again buys thousands of ETH

Sharplink Gaming bought his first Ethereum stack at the beginning of June and has since earned 2,318 ETH through a strike. These rewards are currently worth nearly 10 million dollars, converted around 8.57 million euros.

The marketing company believes that Ethereum will be the foundation of the future global financial system. “We look at an opportunity that can take a decade – or even longer – to rebuild the global financial system on other, decentralized rails,” Sharplink Chalom quotes on X.

The Nasdaq company is expanding its Ethereum reserve just about every week. Last week it bought 39.008 ETH for a total amount of more than 176 million dollars, as announced yesterday on X.

In total there are now 837,230 ETH on the balance with a current value of 3.6 billion dollars. Only Bitcoin miner Bitmine Immersion Technologies has even more Ethereum as a listed company: 1.87 million pieces with a value of $ 8.04 billion.