CryptoQuant CEO Ki Young Ju revealed that Ethereum is currently undervalued in 10 out of the 12 valuation models. The report revealed that most of the valuation models value ETH above $4,000.
The executive emphasized that trusted experts across academia and traditional finance came up with the valuation models.
The analyst cited data from ETHVal, a platform designed to track Ethereum’s intrinsic value using the 12 different valuation methodologies. According to the tracker, ETH’s composite fair value, as determined by the 12 models, is approximately $4,535.1.
The figure represents a potential gain of 60% compared to its current trading price. The valuation models are ranked on a three-tier scale, with one being the least reliable and three being the most reliable.
Metcalfe’s law values ETH the most, with more than 200%
Metcalfe’s law, which states that the value of a network grows in proportion to the square of the number of real active users or nodes in the network, had the highest ETH valuation. The model proposed that the crypto asset is undervalued by more than 213% at a projected price of $9,534, according to an image shared by Ju.
DCF staking yield ranked second among the 12 valuation models, with a 200% undervaluation that priced ETH at $ 8,996.80. Validator Economics valued Ethereum at $6,985.1 while Settlement Layer followed closely behind with a valuation of $5,105.8. The Commitment Premium valued ETH at $ 5,068.90.
App Capital, which incorporates total on-chain assets, including stablecoins, ERC-20 tokens, non-fungible tokens (NFTs), real-world tokenized assets (RWAs), and bridged assets, priced the crypto asset at $4,920.5. L2 Ecosystem and TVL Multiple valued ETH at $4,716.1 and $4,110.5, respectively.
MC/TVL Fair and Staking Scarcity models had the lowest ETH valuation above the crypto asset’s market price, valuing ETH at $3,523.3 and $3,496.5, respectively. Revenue Yield, which values ETH by the yearly revenue obtained from the network, divided by the staking yield, revealed that ETH was overvalued and priced the crypto asset at $1,433.8. The P/S Ratio (25X) model priced ETH at just $923.4 according to ETHVal.
Ethereum dips by 5% despite renewed institutional interest last week
Data from CoinMarketCap shows that Ethereum is down 5% in the last 24 hours, despite the fresh bullish valuation analysis and renewed institutional interest witnessed last week. Data from the U.S. spot ETF tracking website SoSoValue shows that spot Ethereum ETFs witnessed inflows worth $76.55 million on Friday, marking a five-day streak of positive flows. Friday’s inflows exceeded those witnessed in spot Bitcoin ETFs on the same day, which recorded $71.37 million in net inflows.
The news comes after Cryptopolitan reported that ETH futures trading was expanding faster than that of Bitcoin and Solana. The report also highlighted that the crypto asset’s open interests were rising. Another report signaled that ETH is trading near a fair value territory. According to the publication, the reserves of Ethereum exchanges are at an all-time low, indicating a near absence of readiness for spot selling.
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Source: https://www.cryptopolitan.com/ethereum-is-undervalued-valuation-models/
