David Grider, the director of Digital Asset Strategy at Fundstrat Global Advisors, discussed Bitcoin (BTC) and Ethereum (ETH) and the crypto market as a whole in the firm’s Weekly Crypto Briefing released on 29th April 2021.
In the company’s latest note released, David Grider stated that Ethereum reached a new all-time high of $2,800 this week, which is a significant height for further price highs.
“We’re maintaining our overweight Ethereum vs. Bitcoin recommendation from April 2020 and reiterating our ~$10.5k price target from January this year.”
He stated further that Bitcoin (BTC), the largest cryptocurrency by market capitalization, always has the first impression of newcomers in the crypto industry, before they start learning about other assets, such as Ethereum (ETH):
“When new investors come to crypto the first asset they generally hear about and buy is Bitcoin before learning about other assets and allocating across the space. We think the same learning curve is playing out with institutional investors right now where the crypto narrative is shifting from Bitcoin to Ethereum and other segments like DeFi and Web 3 apps.”
Why Fundstrat Is Bullish On Ethereum (ETH)
According to Grider, Fundstrat sees the current developments around Ethereum (ETH) and the resulting economic activity in its digital economy as a bullish signal.
The firm set its $10,500 price target by considering the value of Ethereum (ETH) on a revenue multiple basis, adding that if the correspondingly strong improvement in fundamentals is put into consideration, the digital token is still as cheap as it was three months ago when it was trading around $1,400.
Grider also stated that the firm sees the aspect of the fees as an important way to look at Ethereum, considering the upcoming changes to its network economics with EIP-1559.
“Ethereum is transitioning from a currency like Bitcoin to a crypto capital asset where a portion of the network transaction fees are used to buy back (burn) and retire (treasury stock) ETH supply.
“In crypto accounting terms, this is the same as a company using revenue (fees), less operating costs (stock comp supply issuance), and earing profit (net supply burn) that is used to buy back stock (share repurchase). This means the network would become “profitable” like a company once ETH supply reduction from burned fees outpaces inflation.”
Ethereum (ETH) in the Market
Ethereum (ETH) continues to maintain its stability above the $2,800 support level and keeps showcasing signs of further price uptrend.
At the time of filing this report, ETH is trading at $2,860.74, with about a 3% price uptrend in the last 24 hours.