Ethereum, an undervalued nugget at $2,200?

While bitcoin has started 2023 explosively with a jump of more than 140% since January, Ethereum remains lagging behind. However, despite solid fundamentals, ETH is still 54% below its all-time high. Undervalued, it could soon catch up and take off.

Ethereum in the shadow of Bitcoin

Since the rally began in mid-October, Ethereum has seen growth of around 30%, significantly lower than Bitcoin’s meteoric gains which soared 55%. Observers have noted that Ethereum has not benefited as much as its counterpart from the hype surrounding spot Bitcoin ETFs.

However, the fundamentals of the Ethereum network remain impressive, as recalled yesterday Ryan Sean Adams of Bankless: with its annualized profits of $2.7 billion and its price/earnings ratio of 98 – higher even than Amazon’s 75 – the current price of $2,200 appears “hilarious”.

Above all, since the September 2022 merger, ETH has embarked on a deflationary trajectory, with a reduction in supply of more than 293,000 units according to Ultra Sound Money.

Added to this is the attractive remuneration of 5.3% promised to validators for staking, making Ether “the obligation of the internet”. The asset also ticks the ESG boxes thanks to its energy-efficient proof-of-stake mechanism.

Next growth drivers in perspective

In addition to these solid fundamentals, Ethereum will also soon be able to count on new catalysts. An ETF backed by Ether is likely in 2024, potentially draining billions of dollars.

Some are even already talking about a surge towards $10,000. This is therefore the ideal time to buy before the rise really begins.

Thus, thanks to impressive fundamentals and upcoming bullish catalysts such as a possible spot ETF, Ethereum has strong potential. Its current price reflects clear undervaluation. A surge to new heights seems possible in 2024.