Ethereum has been in the spotlight recently, especially following its latest hard fork, which introduced the ability to withdraw staked ETH and presented a significant new competitor to US T-bills. As a result, financial group VanEck has decided to revisit its Ethereum estimates using a robust valuation model, leading to some eye-opening predictions for the future of the second-largest cryptocurrency.
In its Base Case scenario, VanEck projects that Ethereum’s annual revenue will rise dramatically from $2.6 billion to a whopping $51 billion by 2030. This projection is based on various factors such as transaction fees, Maximal Extractable Value (MEV), and the innovative concept of “Security as a Service.” By making a few calculations, including the deduction of a 1% validator fee and applying a global tax rate of 15%, VanEck’s analysis concludes that the projected cash flows to Ethereum will amount to $42.90 billion. With a free cash flow (FCF) multiple of 33x and considering a token supply of 120.7 million, VanEck arrives at a Base Case 2030 Price Target of $11,848 per token.
It’s worth noting that this bullish prediction assumes Ethereum will maintain a 70% market share among smart contract protocols. But given Ethereum’s current dominance in key sectors such as transactions, finance, banking, payments, metaverse, social and gaming, and infrastructure, this doesn’t seem too far-fetched. Furthermore, Ethereum’s potential as a store-of-value asset has been explored, considering factors like its programmability, cross-chain capabilities, and the aforementioned “Security as a Service” concept.
Of course, with Ethereum’s current price standing at approximately $1,875.79 as per CoinMarketCap data and a 24-hour trading volume of over $9 billion, predicting a token price of $11.8k by 2030 may invoke skepticism in some. But as Ethereum continues to evolve and capture market share, its role as the leading smart contract platform and its potential as a store-of-value asset become increasingly prominent in the crypto landscape.
Despite the optimistic outlook, it remains essential to exercise caution and do your market research before investing in ETH or any other cryptocurrencies. This content may include personal opinions subject to market conditions, and neither the author nor the publication can be held responsible for any personal financial loss. Educate yourself and stay informed on the dynamic world of blockchain and crypto markets, as Ethereum and other digital currencies continue to shape the future of finance.
Source: Coingape
