Researchers at Standard Chartered Bank recently claimed that Ether (eth), the second-largest cryptocurrency by market cap, could rise to 500% of its current price by 2026.
The bank’s bullish prediction follows a similarly optimistic forecast for bitcoin (btc), which it claimed could reach $120,000 before 2025.
Why eth could skyrocket
According to a research report published by the bank on Wednesday, ethereum‘s dominance compared to other smart contract platforms combined with upcoming technical upgrades is likely to boost the value of its native gas token.
“We believe ethereum‘s established dominance on smart contract platforms, along with emerging uses in gaming and tokenization, has the potential to drive eth to the $8,000 level by the end of 2026 (a 5x multiple of the current price). of $1,600),” wrote Geoffrey Kendrick. , head of foreign exchange and cryptocurrency research at the bank.
Its momentum won’t stop there: Kendrick suspects the $8,000 mark will be just an initial step on the path toward its “long-term structural valuation” of $26,000 to $35,000, a price range set by the bank in September 2021.
This valuation assumes use cases that have yet to manifest for eth, although integration into the gaming and tokenization spheres is likely to support its development, the analyst said.
Since 2021, ethereum has undergone a major upgrade in “The Merge”, which transitioned the network to a proof-of-stake consensus mechanism in September 2022.
However, the update only marks the first of five major development milestones, all of which are intended to optimize ethereum‘s data storage, increase scalability, maintain decentralization, and ultimately unlock its potential.
ethereum Future Outlook
Some of its upcoming upgrades, including “protodank sharding,” “will help cement ethereum‘s dominance in the smart contract space, thereby increasing its P/E ratio (if not its earnings) for years to come,” he said. Kendrick.
Last month, JP Morgan analysts wrote that they were disappointed with ethereum‘s network performance since the Shanghai upgrade in April, but that protodank sharding may be a saving grace. Scheduled for later this year, the upgrade should increase ethereum transaction throughput and overall network performance.
Beyond the changes to the native network, Standard Chartered says the eth price may also benefit from the upcoming bitcoin halving in April. Potential spot ETF approvals for both assets in the United States are similarly bullish.
“We set it for the end of 2024, after the US elections,” Kendrick wrote.
According to the analyst, such factors could push eth above $4,000 by the end of 2024, 2.5 times higher than the current price.
In July, the bank predicted that bitcoin could fetch $50,000 by the end of 2023 and $120,000 by the end of 2024. The btc coin is trading at $27,089.
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