Researchers at Standard Chartered Bank recently claimed that Ethereum (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 rise
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 will likely drive value to its native gas token.
“We believe Ethereum’s well-established dominance on smart contract platforms, coupled with emerging uses in gaming and coding, has the potential to push Ethereum to the $8,000 level by the end of 2026 (a 5x multiple from the current price of $1,600),” Jeffrey Kendrick wrote. , Head of the Bank’s Forex and Cryptocurrency Research Department.
Its momentum won’t stop there: Kendrick suspects that the $8,000 level will be just an initial step on the path to a “long-term structural valuation” of $26,000 to $35,000 — the price range the bank set in September 2021.
The analyst said that this assessment assumes use cases that have not yet emerged for Ethereum, although integration in the areas of gaming and coding will likely support its development.
Since 2021, Ethereum has undergone a major upgrade in “The Merge”, which moved the network to a Proof of Stake consensus mechanism in September 2022.
The upgrade represents just the first of five major development milestones, all of which aim to simplify Ethereum’s data storage, enhance scalability, maintain decentralization, and ultimately unleash its potential.
Future predictions for Ethereum
Some of its upcoming upgrades, including a “protodank fork,” “will help consolidate Ethereum’s dominance in the smart contract space, thereby increasing its P/E ratio (if not its dividend) over the next two years,” Kendrick said.
Last month, JP Morgan analysts wrote that they were disappointed with the Ethereum network’s performance since Shanghai was upgraded back in April, but that the initial data fork could be a saving grace. The upgrade is scheduled to take place by the end of this year, and should increase Ethereum’s transaction throughput and overall network performance.
In addition to the LAN changes, Standard Chartered says the ETH price may also benefit from the upcoming Bitcoin halving in April. Potential spot approvals of ETFs for both assets in the US are equally bullish.
“We plan for late 2024, after the US elections,” Kendrick wrote.
Such factors could take ETH past $4,000 by the end of 2024, according to the analyst — an increase of 2.5 times from today’s price.
In July, the bank predicted that Bitcoin would reach $50,000 by the end of 2023, and $120,000 by the end of 2024. Bitcoin is trading for $27,089.
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