The pursuit of high returns from holding Ethereum poses significant risks for companies, according to Joseph Chalom, co-founder of SharpLink Gaming, in an interview with Bankless.
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“There will be people, as in traditional finance, who will want to capture the last 100 basis points of yield and will think it is risk-free,” he said.
Chalom emphasized that while there are ways to achieve double-digit returns in ETH, they come with significant threats. These include credit, counterparty, and timing risks, as well as smart contract vulnerabilities.
He believes another danger lies with companies trying to catch up.
“The biggest risk is that lagging players will take reckless steps,” the expert added.
The co-founder of SharpLink Gaming believes the reputation of the entire sector could suffer due to the actions of individual participants who imprudently attract capital or attempt to stand out through yield.
SharpLink Gaming is the second-largest public holder of ETH, with assets worth $3.62 billion, trailing only BitMine Immersion Technologies ($8.06 billion).
In August, Ethereum founder Vitalik Buterin supported corporate treasuries in the second-largest cryptocurrency by market capitalization but warned of risks.
Later, Geoffrey Kendrick of Standard Chartered stated that ETH and companies holding the asset are undervalued.