- VanEck has significantly marked up its 2030 Ethereum price prediction.
- The change in forecast follows the recent approval of spot Ethereum ETFs.
- According to VanEck, the network has the potential to disrupt trillion-dollar industries.
On May 23, the U.S. SEC approved spot Ethereum ETFs in a landmark move that further legitimized Ethereum and the broader crypto market as an investment class.
Following the landmark and largely unexpected decision, several market observers and participants have been forced to reevaluate their long-term view of the asset. Among these participants is VanEck.
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In a recent report, the firm has nearly doubled its price expectations for Ethereum in the next six years.
Ethereum to $22K?
On Wednesday, June 5, VanEck released a report predicting that Ethereum’s price could reach $22,000 by 2030 with a market valuation of $2.2 trillion, representing an over 400% increase from current prices and the asset’s current market cap at $3,856 and $464 billion, respectively.
The prediction comes as the impending ETH ETF issuer expects the Ethereum network to disrupt several industries, from finance to big tech and even AI, markets that VanEck estimates give the network a total addressable market of $15 trillion.
According to VanEck, Ethereum’s share of these markets will only likely grow due to its unique cost savings and revenue model. For example, while Google and Apple take around 30% of the revenue from applications on their platform, the Ethereum network only takes about 24%. At the same time, VanEck estimates these application hosting costs are likely to drop to 5-10% on Ethereum in the next year and a half as activity shifts to Layer 2 chains.
The asset manager argued that this potential put the network well on the path of generating free cash flows of about $66 billion with a 33x valuation multiple, which will bring their projection to realization.
While VanEck’s fresh ultra-positive outlook on Ethereum has been triggered by the approval of spot Ethereum ETFs, whether these ETFs themselves will be an immediate hit remains to be seen as the SEC continues to work with issuers on S-1 registration statements.
ETH ETFs Success Still Up For Debate
For most experts, Ethereum ETFs are likely to see significant demand but unlikely to mirror the same level of success as their Bitcoin counterparts.
Senior Bloomberg ETF Analyst James Seyffart argued that Ethereum ETFs could generate 20-25% as much inflow as Bitcoin ETFs. On the other hand, Seyffart’s colleague Eric Balchunas has opted for a more conservative 15-20%.
K33 Research has come to similar conclusions, estimating that Ethereum ETFs could rake in $4 billion in inflows in the first five months of trading. By comparison, Bitcoin ETFs have seen over $15 billion within the same period.
On the Flipside
- VanEck suggests several factors could shift their recent prediction, including regulatory and governmental changes.
Why This Matters
Ethereum is the second-largest cryptocurrency by market capitalization. VanEck’s recent ultra-optimistic shift on the asset further highlights the significant potential of recently approved ETFs to legitimize the asset.
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