ETHEREUM could reach wildly high prices of $100,000 per coin if it develops as a market store in the same way as gold according to Blockchain advisor and entrepreneur, Brian Schuster.
Mr Schuster declared that the volatile market could see the cryptocurrency spike to a market potential in the region of $10trillion that could see each Ethereum coin worth as much as $100,000.
He stated: “What if you believe that Ethereum is less like one individual business and more like a store of value, like gold?
“This gives us a potential market capitalisation of roughly $10trillion, leading us to believe that the price of Ethereum might rise as high as $100,000 per coin.
“We might even go one step further and say that Ethereum is not like one asset, but an asset to replace all currency that exists.
“In that case, the market capitalisation would have the potential of reaching $100trillion, leading us to believe the price of Ethereum might rise as high as $1,000,000 per coin.”
However, the expert warned that price predictions should not be taken “as gospel” given the “sporadic and often unpredictable” nature of market prices.
He went on: “Given the sporadic and often unpredictable nature of cryptocurrency, many new traders turn to social media for answers.
“And it’s no wonder why: With the meteoric rise of cryptocurrency in the last two years, new investors are wondering if they can make massive returns and buy a castle in the San Francisco Bay Area.
“People tend to take price predictions as gospel and make poor decisions based on even the most tempered recommendations.
“A big topic of cryptocurrency speculation at present is the future of Ethereum (ETH).
“Will Ethereum ever reach $10,000 (£7,168.70)? My answer is simple: I don’t know, and I’m not going to tell you that it will. But what I will tell you is how to figure this out for yourself by understanding market capitalisation.”
Mr Schuster explained that market capitalisation refers to the total value of a cryptocurrency and not just to the single price of one coin.
He went on to describe that the current supply of Ethereum is estimated at 97million tokens.
The expert declared: “Market capitalisation goes a step beyond price to give more context to the total value of a cryptocurrency.
“You’ve likely heard that Ethereum is worth many billions of dollars depending on the day.
“The way to calculate this figure is by looking at the circulating supply of Ethereum as of this writing, roughly 97million tokens and multiplying it by the coin’s price around $950.
“In the last week, the market capitalisation of all circulating Ethereum is around $92billion.
“Even if cryptocurrencies seem unpredictable today, every asset must reach some value plateau.
“This normalisation happens when the market has been saturated and every player has their say.
“Eventually, cryptocurrencies will reach this point. The reason market capitalisation is useful is because it can allow us to make comparisons across different types of asset classes and to extrapolate future cryptocurrency prices.”
Ethereum is currently worth $793.60 at the time of writing.
The cryptocurrency has plummeted by 13.7 per cent this week that has seen the value of each coin fall by $125.98
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