Ethereum could outperform Bitcoin, eyes $10k milestone

Spot Ether ETF is on the table, and chances are that its approval would bring almost $4 billion worth of inflows. This has put ETH in an ideal position to surpass the $10,000 milestone. A tentative timeline is hard to draw, but experts predict that it could happen in the second half of 2024.

For reference, the US Securities and Exchange Commission (SEC) has only approved 19b-4 forms and not the registration forms. It is the approval of the registration forms that would enable the exchange platform to take the ETF product live and allow traders and investors to trade.

Nevertheless, the community is optimistic, with sentiments reflecting all across the cryptocurrency. The price of the cryptocurrency currently stands at $3,810.00 (at the time of writing), rising by 0.96% over the past 24 hours and falling by 1.57% over the past 7 days. The upcoming milestone is quite ambitious and draws inspiration from five key factors. These are low operating costs, token burn mechanisms, token incentives, locked supply, and high onchain activity.

Validators with lower operating costs do not need to sell a lot of ETH tokens. BTC holders, on the other hand, have to sell their holdings to cover their costs. Ethereum boosts token incentives by rolling out $7.2 million each day. This is less than Bitcoin, where members take home a collective fund of $43.8 million. The lower value of the token incentive also leads to a decrease in selling activity. Thereby, benefiting Ethereum in the end.

The token burn mechanism burns almost 80% of the transaction fees. This brings down the overall supply of ETH, allowing it to retain only 20% to help run the network. Locked supply entails holding 40% of the token as soft locked as collateral or DeFi services. This stabilizes prices by reducing the circulating supply. Finally, a higher onchain activity includes high usage of the chain for multiple purposes, including, but not limited to, NFTs, gaming, and layer-2 solutions. A higher onchain activity leads to a higher burning of ETH tokens. Consequently, this creates scarcity and boosts its worth.

Also, what has triggered the hopes for a milestone of $10,000 is the fact that ETH has broken out of the multi-month falling wedge pattern.

In short-term predictions, ETH falls behind. It is anticipated to achieve $3,876.01 in the next 30 days. This would practically mean very little change in a month. Bitcoin, on the other hand, is poised to achieve the mark of $89,728 during the same timeframe. This would be a jump of 27.58% from the current value of $70,949 (at the time of writing).

BTC is already riding the bull via the Spot ETF product. TH has yet to experience that scenario. It is less likely that the Commission would approve Ether ETF applications any time soon, but the community remains determined by their bullish sentiments.

David Cox

David is a finance graduate and crypto enthusiast. He projects his expertise in subjects like crypto and Blockchain while writing for CryptoNewsZ. Being from Finance background, he efficiently writes Price Analysis. Apart from writing, he actively nurtures hobbies like sports and movies.

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