ETH price can hit $11.8,000 with up to $51,000 in revenue by 2030

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VanEck analysts have detailed why the price of ETH could exceed $11,000 by 2030, with revenues of over $50 billion.

According to a report by VanEck, Ethereum (ETH) the price could reach $11.8,000 by 2030. The global investment manager exposed its ETH price predictions earlier in the month.

On May 9, VanEck’s head of digital asset research, Matthew Sigel, and senior digital asset investment analyst, Patrick Bush, made bold statements. The duo provided a detailed valuation methodology incorporating cash flow projections and fully diluted valuation calculations to support their argument.

At the time, Sigel and Bush explained that their Ether price inquiries had been updated following the recent hard fork. According to VanEck analysts, the projected ETH price increase in 2030 could also boost annual revenue from $2.6 billion to $51 billion. Additionally, the duo said their price prediction assumes a 70% smart contract protocol for the popular digital currency. This projection has been discounted to $5,300 at a 12% capital cost derived from the recent Ethereum beta. Additionally, Sigel and Bush assessed altcoin market capture in critical sectors. They also explored its potential for storing value in the crypto space. Analysts say ETH’s new proof-of-stake status could see US Treasuries rival the crypto.

VanEck Methodology Used to Determine ETH 2030 Price

VanEck’s analysis assessed the value of the price of ETH by estimating cash flows for the year ending April 30, 2030. The crypto price assessment methodology also involved a series of calculations to arrive single-digit cash flow. One of them was accounting for deductions from the overall tax rate,

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Meanwhile, to get ETH’s fully diluted 2030 valuation, analysts applied an estimated long-term cash flow yield of 7%, subtracting the long-term crypto growth rate of 4%. Finally, the fully diluted valuation total is divided by the expected number of coins in circulation, with the result being discounted by 12% to April 20, 2030.

VanEck analysts have also recognized ETH system transaction fees and maximum extractable value (MEV) as a revenue line. Moreover, the company’s analysts have also claimed that the token is evolving beyond its traditional use cases of being a transactional currency or a consumable product. Although not quite sure Bitcoins At the store of value level, Sigel and Bush reasoned that Ether could still become a store of value for human capital maximization purposes. VanEck analysts also pointed to the perceived vibrancy of ETH’s store of value applicability inside and outside the Ethereum blockchain. According to the duo, the token’s value is versatile in securing applications, protocols, and ecosystems throughout the crypto space.

Basic ETH Price Scenario

In a base case scenario, VanEck analysts assume that Ether will achieve annual revenue of $51 billion in the year ending April 30, 2030. Additionally, the duo deducted a validator fee of 1% of the total and an overall tax rate of 15% to arrive at a cash flow of $42.90 billion for the same period. Sigel and Bush also noted:

“We base these estimates on the thesis that Ethereum is becoming the dominant global open-source settlement network that hosts substantial parts of the trading activity of industries with the greatest earning potential by moving their trading functions to blockchains. of public blocks. In a portfolio of similar smart contract platforms, we assume to hold a collection of call options, with the dominant platform likely to take majority market share.

Using the parameters above, VanEck analysts claimed that the discounted price for the base case of ETH, as of May 9, was $5,359.71. The leading altcoin is currently changing hands at just over $1,900.

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Tolu Ajiboye

Tolu is a Lagos-based cryptocurrency and blockchain enthusiast. He likes to demystify crypto stories to the essentials so that anyone, anywhere can understand without too much background knowledge. When not immersed in crypto stories, Tolu loves music, likes to sing, and is a movie buff.

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