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Standard Chartered Bank saidEven though Ethereum, the second largest cryptocurrency, soared to an all-time high of $4,955 on August 25, Ethereum and its treasury holdings are undervalued.
Geoffrey Kendrick, head of cryptocurrency research at the bank, said that since June, treasury companies and ETFs have absorbed nearly 5% of circulating Ethereum, of which treasury companies bought 2.6% and treasury companies increased their holdings by 2.3%.
The two have a total holdings of 4.9%, which is one of the fastest growth cycles in cryptocurrencies’ history, and its speed exceeds the speed at which BTC treasury and ETFs increased their holdings of 2% in circulation by the end of 2024.
Kendrick said the recent surge in holdings marks the early stages of a broader increase cycle.In his July report, he predicted thatCaikuan Company may eventually control 10% of circulation Ethereum.
Kendrick believes that this goal seems to be achievable given that companies such as BitMINE have publicly targeted their 5% position.He pointed out that this means that there is still 7.4% of the liquidity to be increased, which will provide strong support for Ethereum prices.
The rapid pace of holdings increase highlights the increasingly important role of institutional entities in the cryptocurrency market.Kendrick said that the coordination between ETF capital flow and treasury increase has formed a “feedback loop”, which may further tighten supply and drive prices higher.
Kendrick raised the bank’s previous forecast.sayEthereum may climb to $7,500 at the end of the year.He also said that the current pullback is an “excellent entry point” for investors to deploy for subsequent capital inflows.
Although buying pressure pushed up Ethereum prices, the valuation of Ethereum holding companies has changed inversely.
SharpLink and BitMINE are the two most mature Ethereum treasury companies, with their net asset value (NAV) multiples lower than the largest Bitcoin treasury company Strategy.
Kendrick said the valuation discount was not reasonable because Ethereum treasury companies could receive a 3% pledge gain, and Bitcoin held by Strategy could not generate such gains.
He also mentioned that SBET plans to buy back shares when its NAV multiple is below 1.0, saying this sets a “solid bottom” for the valuation of Ethereum Treasury companies.
