[ad_1]
The Ethereum ‘Merge’ remains one of the most anticipated upgrades out of the crypto space. This merge would be the network on a completely different track by improving the security and scalability of the blockchain. One thing that remains at the forefront of investors’ minds is what impact this upgrade will have on the asset as a whole and according to Bloomberg analysts, there are only good things in store for the cryptocurrency after the merge.
Ethereum Is Undervalued
In a recent report, Bloomberg analysts Mike McGlone and Douglas Coutts have laid out a bullish scenario for Ethereum. This digital asset which has become a formidable competitor for Bitcoin in recent years has been upgrading its network over the last two years. This is in an effort to move towards a proof of stake mechanism that would allow the network to move away from the energy-intensive proof of work mechanism.
Related Reading | Why Crypto Mining Firms Will Be More Secure Due To A Ledger And Blockware Partnership
The Merge which is scheduled to happen sometime this year is a significant milestone for the blockchain and according to these Bloomberg analysts, one that would see interest in the blockchain grow significantly. One reason for this would be the ease with which users are able to partake in the network activities. Alongside the numerous earning potential for users who choose to stake their tokens on the network.
Both analysts believe that the digital asset is still very much undervalued as of today. Pointing to the upcoming merge, the analysts explained; “The upcoming merge, shifting Ethereum from a Proof-of-Work model to Proof-of-Stake, will convert Ether into an equity-like instrument with elegant supply/demand dynamics that could drive significant interest in the asset.”
ETH trading at $3,453 | Source: ETHUSD on TradingView.com
With the expected surge of interest to come after the merge is completed, there is every reason to believe that the price of the digital asset would end up benefitting from this. This is because there would be increased demand for the digital asset, making them more valuable over time.
Price Should Be Higher
Not only do the analysts believe in the future of Ethereum, but they also believe that the digital asset remains undervalued even presently. Using a discounted cash flow model, they pointed out that Ethereum continues to trade at 70% below its fair value, which is at $6,100.
Related Reading | South Korean Tech Giant Kakao Acquires Majority Stake In A Japanese Crypto Exchange
Through various downtrends, Ethereum has continued to hold up in the market. Its widespread use cases remain one of the most convincing points for the future potential of the cryptocurrency. It had hit an all-time high close to $5,000 last year but if the analysis from McGlone and Coutts is correct, then ETH is only beginning its trend.
The digital asset is currently trading above $3,500 at the time of this writing. Holding on to its second position on the largest cryptocurrencies by market cap with a total market cap of $423 billion.
Featured image from Capital.com, chart from TradingView.com
[ad_2]
Source link
