According to a recent assertion made by researchers at Standard Chartered Bank, Ether (ETH), the cryptocurrency occupying the second-largest market capitalization position, may experience a substantial surge of 500% in value by 2026.
The bank’s forecast, characterized by a positive outlook, aligns with a parallel projection for Bitcoin (BTC), which posits a potential attainment of $120,000 by 2025.
Why Ethereum Might See Its Price Soar
In a research report released by the financial institution on Wednesday, Ethereum’s market dominance over various intelligent contract platforms, coupled with forthcoming technical enhancements, is anticipated to contribute to the appreciation of its native gas token.
In the words of Geoffrey Kendrick, the head of forex and crypto research at the bank, it is believed that Ethereum’s current dominance in innovative contract platforms, coupled with its emerging applications in gaming and tokenization, holds the capacity to propel ETH to a value of $8,000 by the conclusion of 2026. This projection represents a five-fold increase from its present price of $1,600.
The momentum of the cryptocurrency is anticipated to persist beyond its current position. Kendrick posits that the attainment of the $8,000 threshold merely serves as an introductory milestone towards its projected “long-term structural valuation,” ranging from $26,000 to $35,000. The bank initially determined this valuation range in September 2021.
The valuation presented considers potential use cases that have yet to materialize for ETH. However, it is anticipated that integration within the gaming and tokenization domains will contribute to their advancement, as suggested by the analyst.
Since 2021, the digital currency Ethereum has undergone a significant transformation known as “The Merge,” wherein the network has transitioned to a consensus mechanism based on proof of stake as of September 2022.
The initial upgrade signifies the commencement of a series of five significant developmental milestones, each designed to optimize Ethereum’s data storage, enhance scalability, preserve decentralization, and ultimately unleash its inherent capabilities.
The Prognosis for Ethereum Moving Forward
In the words of Kendrick, specific forthcoming enhancements, such as the implementation of “proto dank-sharding,” are expected to solidify Ethereum’s prevailing position within the realm of smart contracts. Consequently, this is projected to positively impact its price-to-earnings ratio, albeit not necessarily on its actual earnings, within the foreseeable future.
In a recent report, analysts from JP Morgan expressed dissatisfaction with the network performance of Ethereum after the Shanghai upgrade in April. However, they did acknowledge the potential of proto-dank-sharding as a potential solution to this issue. The promotion, slated for completion within the current calendar year, is anticipated to yield a notable augmentation in Ethereum’s transaction throughput and overall network performance.
In addition to inherent alterations within the native network, Standard Chartered posits that Ethereum’s price may potentially derive advantages from the imminent Bitcoin halving event scheduled for April. The potential approvals of spot ETFs for both assets in the United States exhibit a similar level of bullish sentiment.
The scheduling of this event is tentatively planned for the latter part of 2024, after the United States election, as indicated by Kendrick’s statement.
Based on the analysis conducted, various factors have the potential to propel the value of ETH to surpass $4000 by the conclusion of 2024, representing a significant increase of 2.5 times its current market price.
According to the bank’s forecast in July, it was projected that Bitcoin may reach a value of $50,000 by the conclusion of 2023, followed by a projected value of $120,000 by the close of 2024. The current trading value of BTC currency stands at $27,089.