VanEck Analysts Increase Price Target for Ethereum ETH to 22000
The Ethereum ecosystem has seen a dramatic increase in the number of active users over the past four years, with daily active users growing ninefold since 2020.
According to data from crypto ETF issuer Bitwise, the Ethereum ecosystem, which includes its layer-1 mainnet and layer-2 scaling solutions like Arbitrum, Polygon, Optimism, Base, and zkSync, had an average of over 2.25 million daily active users in the first quarter of 2024, compared to just 250,000 in Q1 2020.
This substantial growth in user activity has attracted the attention of analysts at VanEck, a leading crypto ETF issuer. In a recent blog post, VanEck’s head of digital assets research, Matthew Sigel, and his team raised their price target for Ethereum, predicting that the cryptocurrency could reach $22,000 by 2030.
The analysts pointed to the increasing demand for Ethereum and its scaling solutions, as well as the expected approval of spot Ether ETFs on U.S. stock exchanges, as key factors driving their optimistic outlook.
The approval of spot Ether ETFs would enable financial advisors and institutional investors to include Ethereum in their portfolios, benefiting from the advantages of ETF pricing and liquidity. VanEck analysts projected Ethereum’s 2030 valuation based on a forecast of $66 billion in free cash flows generated by the network and accruing to the ETH token.
Although the percentage of users on the Ethereum mainnet has decreased due to the shift of transactions to layer-2 networks, this is part of Ethereum’s long-term plan. Co-founder Vitalik Buterin has been focusing on using layer-2 solutions to scale the main blockchain, suggesting that they are similar to the sharding concept of the old Eth 2 plan and may help foster growth in various “subcultures” within the Ethereum ecosystem.
Despite the lower number of users on the Ethereum mainnet, the blockchain still generates three times more in fees than the top layer-2 networks and Solana combined, highlighting its value proposition.
