VanEck Research, an investment management firm, has reevaluated its projections for Ethereum’s (ETH) revenue and valuation in a recent report after the hard fork. By employing a comprehensive valuation model, the firm anticipates that the price of ETH will surge to $11,800 by 2030. This would result in an annual revenue of $51 billion, a significant increase from the current $2.6 billion.
VanEck Research Forecasts Ethereum Surge to $11,800
Investment management firm VanEck Research has recently revised its estimations regarding Ethereum’s (ETH) future revenue and valuation after the hard fork. By employing a meticulous valuation model, the firm foresees a rise in ETH price to $11,800 by 2030, resulting in an annual revenue of $51 billion compared to the current $2.6 billion.
Today, Chinese blockchain reporter Colin Wu highlighted this ambitious prediction in a tweet, capturing public attention.
VanEck Research has provided a comprehensive analysis that utilizes a transparent valuation methodology to assess Ethereum. This methodology takes into account various factors such as transaction fees, Miner Extractable Value (MEV), and “Security as a Service.” The forecasted price of $11,800 for Ethereum is contingent upon Ethereum capturing a market share of up to 70% of all smart contract protocols by 2030.
However, the projected price of $11,800 is currently discounted to $5.3k, factoring in a 12% cost of capital derived from ETH’s recent beta. VanEck highlights that the recent Ethereum Shanghai hard fork, which enabled the withdrawal of staked ETH, positions Ethereum to potentially compete with US Treasury Bills.
Understanding Ethereum’s nature is crucial—it functions as a digital marketplace where secure internet commerce occurs. As a platform for businesses built on smart contract code, Ethereum allows users to engage in commerce without relying on trust.
Validators play a vital role in maintaining the network’s security and recording economic events on the ledger. Simultaneously, Ethereum imposes charges on users for conducting transactions and exchanging value within the platform.
VanEck acknowledges the significance of transaction fees, including base fees and tip fees, as revenue streams for Ethereum. Additionally, they recognize Miner Extractable Value (MEV) as a revenue component for ETH, with a portion of MEV accruing to ETH stakers through validators.
The firm introduces an innovative revenue item called “Security as a Service” (SaaS), emphasizing Ethereum’s potential as a store-of-value asset for state actors aiming to maximize human capital.
VanEck’s projections are based on Ethereum’s market capture as a smart contract platform. They identify three primary business categories: Finance, Banking, and Payments (FBP), Metaverse, Social and Gaming (MSG), and Infrastructure (I).
By assuming a certain percentage of economic activity within each category will transition to blockchain deployment, VanEck estimates Ethereum’s take rate of the business economic activity. This take rate varies across different business categories, ranging from 3% to 10%.
It’s worth noting that at its current price of $1,866, ETH would need to experience a 532% increase in 7 years to reach the target of $11,800 by 2030. Furthermore, this target represents a 141% increase from ETH’s all-time high of $4,891, reached in November 2021.
About VanEck Research
VanEck, as a pioneer among U.S. asset managers, was among the first to provide investors with opportunities to access international markets. The firm also displayed early recognition of the transformative potential of gold investing, emerging markets, and ETFs. Today, VanEck’s capabilities encompass a wide spectrum, spanning from core investment opportunities to more specialized exposures that enhance portfolio diversification.
With a substantial $76.4 billion in assets under management, VanEck offers a diverse range of investment vehicles to cater to different investor preferences. These include exchange-traded funds (ETFs), mutual funds, institutional funds, separately managed accounts, model delivery SMAs/portfolios, as well as UCITS funds and ETFs.
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