Ether, the world’s second-largest crypto, could potentially witness a remarkable surge in its value, soaring more than fivefold by 2027, as projected by Standard Chartered. According to StanChart’s head of crypto and forex research, Geoffrey Kendrick, ether, which serves as the ethereum blockchain’s native crypto, is poised for a substantial ascent, potentially reaching a significant milestone of $8,000 by the end of 2026.
Evaluating cryptocurrencies’ value remains a complex task, primarily due to the absence of traditional assets backing digital tokens such as Bitcoin or ether. Unlike conventional assets, including currencies, bonds and stocks, cryptocurrencies lack established metrics for valuation. Instead, the pricing of crypto tokens tends to be primarily influenced by the collective sentiment of the investor community.
The projected price of $8,000 for ether is merely an initial step toward the bank’s overarching valuation, which aims for a range between $26,000 and $35,000. The prediction stems from the anticipation of substantial enhancements to the ethereum blockchain.
Currently, the network is actively pursuing performance improvements through the implementation of second-layer scaling solutions and upcoming architectural upgrades. One such improvement is the integration of a concept known as “proto-danksharding,” set to be introduced in early 2024. This would significantly reduce transaction costs within the blockchain, thereby enhancing ether’s prominence within the smart-contract space and potentially increasing its price-to-earnings (P/E) ratio in the coming years, according to Kendrick.
The demand for ether is expected to experience an upsurge as new use cases continue to emerge and trends reliant on cryptocurrencies continue to expand. Notably, non-fungible token (NFT) transactions, a prominent use case on the ethereum network, are poised for growth as the crypto winter subsides.
Furthermore, the rise of blockchain-based gaming is expected to fuel the demand for NFTs, subsequently bolstering ether’s value. Another potential driver for ether’s growth lies in real-world asset tokenization where blockchain tokens represent ownership rights, offering significant growth opportunities.
Additionally, the potential introduction of regulatory measures and the awaited arrival of spot exchange-traded funds (ETFs) in the United States, tentatively scheduled for late 2024, are poised to further amplify ether’s adoption and growth, creating more investment opportunities.
While ether has experienced a notable gain of approximately 30% within the current year, it still resides at a level almost 70% below its all-time peak of approximately $4,869, which was achieved in November 2021.
This isn’t the first instance where StanChart has garnered attention with its bullish forecasts regarding cryptocurrencies. The banking giant previously stated that Bitcoin, the preeminent digital token, could reach $50,000 in 2023 and $120,000 by December of next year. Bitcoin was trading at approximately $27,275, as of the most recent data.
When major institutional actors such as StanChart are so bullish regarding the crypto industry, it sends positive signals to the public. As a result, entities operating in this space, such as Riot Blockchain Inc. (NASDAQ: RIOT) could end up attracting even more attention from potential investors or users of cryptos as a result of the forecasts published by the likes of StanChart.
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