- Ether should increase its price by 8 times to exceed $10,000.
- Other cryptocurrencies and tokens could follow ether, and produce what is known as altseason.
“Ethereum represents the best risk-reward relationship in cryptocurrencies,” according to the company Fundstrat Global Advisors. For this group of financial researchers, the price of ether (ETH), a native token of this blockchain, could reach $10,500 by 2021.
Fundstrat bases its forecast on the expectation that the development of new “real-world applications” on the Ethereum network will continue. These innovations include smart contracts, stablecoins that maintain parity with the U.S. dollar, and decentralized finance protocols (or DeFi).
Ethereum fees, often criticized for their magnitude, are another factor that the analytics company considers to be a bullish indiciator.
According to a rare comparison made by Fundstrat, high gas consumption (as commissions in this network are called) is the increasing ethereal equivalent of the number of institutional investors arriving in Bitcoin. Both factors would be catalysts for the increase in the price of these cryptocurrencies.
The company estimates that commissions paid on Ethereum during 2021 will reach USD 4 billion. This is almost seven times higher than the $600 million that was paid in 2020. The above analysts, based on statistical calculations, argue that an ETH price close to USD 10,500 would be in line with this growth.
Other potential growth factors for Ethereum
To all this, we must add the potential institutional investments that some foresee that will reach Ethereum during 2021.
The expectation for new proposals for improvement and for the development of Ethereum version 2.0, which is already partially operational, is worth to be mentioned. This gives some investors more reason to believe that the native blockchain token, developed, among others, by Vitalik Buterin, can generate a considerable monetary return in the near future.
Ether to $10,500 would imply an eight-time increase in its current price (USD 1,314 at the time of writing) during the current year. It is not exorbitant when you consider that in the last 12 months it went from USD 168 to USD 1,432, above its previous all-time high of USD 1,420. Its growth in this period was 8.42 times.
Other cryptocurrencies and tokens, many of which are developed on the Ethereum blockchain, could also see increases in their price as a result of the increased valuation of ETH. If this were to happen massively, we would be dealing with what is often referred to as altseason, or altcoin season.
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