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StanChart claims Ethereum treasury firms are undervalued, updates ETH projection to $7,500 by year-end.
Standard Chartered stated that Ethereum (ETH) and the firms holding it in their treasuries are still undervalued, despite the second-largest cryptocurrency reaching an all-time high of $4,955 on August 25.
Geoffrey Kendrick, the bank’s head of crypto research, mentioned that treasury firms and exchange-traded funds have acquired nearly 5% of all Ethereum in circulation since June. Treasury companies purchased 2.6%, while ETFs contributed 2.3%.
This combined 4.9% stake signifies one of the quickest accumulation periods in crypto history, outpacing the rate at which Bitcoin (BTC) treasuries and ETFs secured 2% of the supply in late 2024.
Progressing toward 10%
Kendrick indicated that the recent surge in buying represents the initial stage of a more extensive accumulation cycle. In a note from July, he anticipated that treasury firms could ultimately possess 10% of all ether in circulation.
Kendrick asserted that with companies like BitMINE openly aiming for 5% ownership, this target seems achievable. He pointed out that this would leave another 7.4% of the supply still available, generating favorable conditions for Ethereum’s price.
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The rapid accumulation rate highlights the increasing significance of institutional frameworks in crypto markets. Kendrick noted that the alignment of ETF inflows with treasury acquisitions underscores a feedback loop that could further tighten supply and bolster higher prices.
Kendrick updated the lender’s earlier predictions, stating that Ethereum could reach $7,500 by the end of the year. He also described the recent price pullback as a “great entry point” for investors preparing for additional inflows.
Valuation disparities
While buying activity has driven prices up, the valuations of firms holding ether have moved in the opposite direction.
Net asset value (NAV) multiples for SharpLink and BitMINE, the two most prominent ETH treasury firms, have fallen below those of Strategy, the largest Bitcoin treasury company.
Kendrick remarked that the discount is unwarranted considering that ETH treasuries can yield a 3% staking return, whereas Strategy does not generate any such income from its Bitcoin holdings.
He also highlighted SBET’s recent intention to buy back shares if its NAV multiple drops below 1.0, indicating that this establishes a firm floor for valuations.
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