Ethereum Hits New ATH: Maintaining OW & Issuing $10.5k Target As Web 3.0 Blockchain Computing Looks Set To Disrupt The Cloud
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Ethereum (ETH) reached a new all time high of $1,440 today, passing the previous high set during January 2018 at the peak of the crypto bubble. We’ve been recommending an overweight in Ethereum since April 2020 and continue to see upside. We continue to believe Ethereum fundamentals are incredibly strong and think ETH represents the best risk / reward investment play in crypto. Web 3.0 blockchain computing may be the future of cloud in our view. Ethereum is now capturing a notable share of the cloud market. ETH transaction fee revenue has been growing at 1099% 5-year CAGR and finished 2020 at ~$600M. During 2021 YTD, ETH has already recorded $180M in cloud revenue, implying an annualized $3.9B by FY 2021. We believe Ethereum should be valued like a cloud 1.0 stock. On a growth adjusted basis, we calculate Ethereum is 1/8th the price of the BVP Cloud Index. Based on our analysis, we are issuing a $10,500 price target on Ethereum (ETH) which represents ~650% upside from current levels.
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