Currently, there are more than 9,600 cryptocurrencies, but in that expansive space, there are two giants – bitcoin and ethereum, frequently referred to as ether.
As of midday Wednesday, bitcoin and ether had market values of $537.55 billion and $223.34 billion, respectively. The pair of digital currencies combine for nearly $761 billion of the total cryptocurrency universe’s market capitalization of $1.14 trillion.
Specific to ether, bitcoin frequently overshadows that asset. But a market cap of $223 billion is still impressive. Not only does it show ethereum adoption and investor confidence are growing, but if the cryptocurrency was a publicly traded company, it’d be the 27th-largest component in the S&P 500.
Not only is ether a credible member of the crypto universe, it has the potential for staggering long-term price appreciation.
Check Out This Ethereum Forecast
Ethereum resides around $1,850. In the third quarter of 2015, investors could’ve nabbed the digital asset for less than $1 before it ascended to its all-time high of $4,444 in late 2021. In other words, ether already has a penchant for big moves. Some market observers believe more could be on the way.
In a recent report, Matthew Sigel, VanEck head of digital assets research, and Patrick Bush, senior investment analyst at the firm, note ethereum could surge to $11,800 by 2030. That’s a more than five-fold jump from recent prices. That implies that the digital asset is undervalued today.
“We now see ETH network revenues rising from an annual rate of $2.6B to $51B in 2030. Assuming ETH takes a 70% market among smart contract protocols, this implies a token price of $11.8k in 2030, which we discount to $5.3k today at a 12% cost of capital derived from ETH’s recent beta,” wrote the VanEck duo.
As the analysts note, there’s an actual business model tied to ethereum. That’s something the bulk of the cryptocurrency space lacks. While ethereum itself isn’t a business, it does generate revenue as more tokens (ether) are used within secure Ethereum applications.
That’s a positive attribute as is the asset’s evolution. And it could be a key component in the aforementioned price appreciation expectations.
“We assert that ETH is evolving beyond a transactional currency or a consumable commodity like oil or natural gas. We believe that ETH, while not a complete store of value like Bitcoin due to Ethereum’s demonstrated mutability of code and an evolving social consensus focused on utility, will nevertheless become a store-of-value asset for state actors looking to maximize human capital (vs. Bitcoin, which maximizes for stranded energy),” concluded Sigel and Bush.
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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.