Ethereum’s (ETH) recent hard fork, enabling users to withdraw staked Ether, is poised to position the cryptocurrency as a formidable contender against US treasury bills in the coming years, according to VanEck, a US asset manager controlling a $69 billion exchange-traded fund (ETF).
Because of this, along with expectations that ETH will account for 70% of smart contract protocols, the world’s second-largest cryptocurrency could hit $11,800 in 2030, VanEck said in its recently released Ethereum price prediction report.
“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.”
– VanEck wrote in the report.
If VanEck’s projections were to materialize, it implies that Ethereum would see a price increase of 531% by 2030 from its current levels.
Further, VanEck also sees ETH network revenues surging from an annual rate of $2.6 billion to as high as $51 billion in 2030.
VanEck’s Calculations
VanEck said the latest price forecast was made using cash flow projections and fully diluted valuation (FDV) calculations. More specifically, the fund manager evaluated Ethereum by estimating cash flows for the year that ended on April 30, 2030.
The asset manager arrived at its cash flow figures by projecting Ethereum revenues and deducting a global tax rate and a validator revenue cut. Then, VanEck said it used multiple estimates by applying a long-term estimated cash flow of 7%, minus the long-term crypto growth rate of 4%.
Finally, the investment arrived at the FDV in 2030, divided that figure by the expected number of tokens in circulation, and discounted the final number by 12%.
Ethereum price analysis
At press time, ETH was changing hands at $1,870, down 1.82% in the past 24 hours.
Over the past month, the cryptocurrency fell more than 6.2%, although its year-to-date gains remain strong at 55.8%.
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