summary:
- Ethereum price predicted to go from $4,600 to $22,000 by 2030
- The network processed $4 trillion in payments last year
- On September 1st, daily gasoline consumption hit a record high of 109 billion tons.
- On-chain stablecoin trading volume hits all-time high of $1.46 trillion
- Layer 2 Adoption Drives Scalability and Growth
Ethereum, the second largest cryptocurrency by market cap, is experiencing a surge in network activity and adoption, leading some analysts to predict that ETH's price will rise significantly over the next few years.
Matthew Siegel, head of digital asset research at VanEck, estimates that the Ethereum network could generate $66 billion in free cash flow annually by 2030.
The prediction is based on the growing role the network plays in processing global transactions, with Siegel noting that Ethereum handled roughly $4 trillion in payment volume over the past year, and an additional $5 trillion in stablecoin transfers annually.
“This is much bigger than PayPal and is starting to get closer to a network like Visa,” Siegel said during a recent panel discussion.
Based on these predictions, Siegel suggests that the price of ETH could reach $22,000 per token in 10 years, which would represent a significant increase from the current price of around $2,300.
David Kroeger, a data scientist at cryptocurrency brokerage StoneX, offered a more conservative but still bullish prediction: He sees the price of ETH rising to around $4,600 over the next 18 months, and potentially even higher to around $12,621.
These price predictions are supported by several key indicators of strong activity and adoption on the network: On September 1, Ethereum's daily gas usage reached an all-time high of 109 billion, despite the recent drop in gas prices. This milestone indicates that demand for the Ethereum network remains robust.
Ethereum on-chain stablecoin volume hit an all-time high of $1.46 trillion, more than doubling from $650 billion earlier this year. DAI led the stablecoin market with $960 billion in volume, with USDT and USDC also continuing to dominate.
This increase in stablecoin trading volume is attributed to the growing demand for decentralized finance (DeFi) and increased involvement of traditional financial institutions.
Layer 2 (L2) solutions are also playing a key role in Ethereum's growth, with platforms such as Arbitrum, Base, Optimism, and Mantle driving scalability and adoption, contributing to the network's long-term potential.
Ethereum has faced some challenges recently. After the Dencun upgrade in March cut transaction fees by about 95%, the network's revenues fell sharply. Sigel acknowledged the setback but is optimistic about Ethereum's resilience.
“Ethereum still has some levers that could lead to a recovery,” Siegel said. “That's what we'll be watching in the second half of the year.”
As Ethereum enters the final quarter of 2024, a period that historically sees increased trading volumes and price volatility in the cryptocurrency market, investors and analysts will be closely watching key metrics such as funding rates.
These rates, which indicate the balance between long and short positions in the futures market, have been hovering at relatively low levels of 0.002 to 0.005, with some analysts saying that a rise above 0.015 could signal the start of a new price upswing.
