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1 Popular Cryptocurrency To Buy Before It Soars By 9,159%…

Oleh Patinko •

How Ethereum works

Ethereum is a platform for developing decentralized software applications, which are increasingly popular in industries gaming and financial services. Each app is governed by slivers of computer code called smart contracts that enforce its rules. Smart contracts live on the Ethereum blockchain and they typically can’t be changed, so no person or entity can manipulate an app’s core functions, ensuring it remains fully decentralized.

The Ethereum network is also fully decentralized. Thousands of nodes (computers) around the world store an updated copy of its blockchain, so the broader network won’t be compromised even if some nodes experience an outage. As a result, Ethereum has maintained 100% uptime during the past decade. This wouldn’t have been possible if the network was hosted in a single data center instead, because even the best infrastructure providers typically promise an uptime of just 99.9%.

Ether is the gas that keeps the network running. Whenever someone uses an Ethereum-based decentralized app, a smart contract is activated, and the person must pay a fee in Ether to cover computer processing costs. Therefore, demand for Ether increases organically as the network becomes more heavily used, which should lift the value of each coin.

Ethereum is entering a new era, driven by tokenization and artificial intelligence

In the past, Ethereum was mostly used to build cryptocurrency applications and create non-fungible tokens (NFTs), but Tom Lee thinks the platform is quickly maturing from those obscure use cases. He says it will gradually enter the mainstream economy where it will be used to build payment rails and even settlement infrastructure for transactions conducted by artificial intelligence (AI) agents, which can take actions with minimal human input.

Financial institutions BlackRock, JPMorgan Chase, and UBS Group have already launched tokenized investment funds that trade on Ethereum-based blockchains instead of traditional stock exchanges. Billions of dollars have flowed into these funds so far, which are used to buy secure assets U.S. Treasury bonds.

Robinhood Markets (HOOD -1.18%) built a Layer-2 blockchain on top of Ethereum called Robinhood Chain. The company is tokenizing real stocks to let clients trade popular securities Nvidia and Tesla outside of regular market hours. To be clear, investors don’t have legal ownership of the underlying stocks when they buy tokenized securities, but they still benefit from any potential upside in exactly the same way.

AI agents can also buy and sell tokenized securities on behalf of their human operators through Robinhood Chain, which could significantly boost transaction volumes in the long term. Speaking more broadly, these agents could eventually have their own money, and a trusted, secure, and decentralized network Ethereum could be perfect for processing their transactions.

Is Lee’s $250,000 target achievable?

A little more than 122 million Ether coins are in circulation as I write this, so at the current price of $2,700 per coin, the ecosystem has a market capitalization of $328 billion. Simple math suggests that a price of $250,000 per coin would result in a market cap of $30.5 trillion, which is almost equal to the output of the entire U.S. economy. It would also make Ethereum more than five times as valuable as the world’s largest company, Nvidia, which is currently valued at $5.4 trillion.

CRYPTO: ETH

Ethereum

Today’s Change

(0.79%) $21.22

Current Price

$2,709.32

Key Data Points

Market Cap

$331BMarket cap calculated using publicly traded s outstanding only. Does not include unlisted, private, or dual-class non-traded s. Implied market cap may vary.

Day’s Range

$2666.72 – $2720.75

52wk Range

$1512.07 – $4753.34

Volume

7.2B

If Ethereum eventually finds itself at the center of the financial system, then Lee’s $250,000 price target might be achievable. However, despite growing adoption by major financial institutions, the network still has just 2.3 million daily active wallet addresses across its primary blockchain and all Layer-2 blockchains, which is down significantly from its peak of almost 4 million last year.

On a positive note, Robinhood Chain is experiencing a surge in adoption which could lift overall usage numbers. But generally speaking, it seems most consumers aren’t very keen to participate in the tokenized economy just yet. I’m not sure what will convince them, but this presents a real challenge for Lee’s $250,000 target.

It’s important to remember that Lee is the chairman of Bitmine Immersion Technologies, which currently owns 6 million Ether coins, or nearly 5% of all circulating supply. The company’s position is worth more than $16 billion, but that would grow to an eye-popping $1.5 trillion if Ether hits $250,000 per coin, so Lee’s forecast is definitely a little self-serving.

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About the Author

Anthony Di Pizio is a contributing Motley Fool technology analyst covering artificial intelligence, cloud computing, autonomous vehicles, and enterprise software. Previously, Anthony was a licensed fund manager, stock broker, and corporate advisor. He holds a bachelor’s degree in commerce and economics from Macquarie University in Sydney, Australia, along with ASIC RG146 certifications in financial securities and derivatives.

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X@AnthonyADSC

Stocks Mentioned

Ethereum

CRYPTO: ETH

$2,709.32

(+0.79%)+$21.22

Motley Fool Stock Advisor’s Latest Pick

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—% Avg Return

Tesla

NASDAQ: TSLA

$372.11

(-1.54%)-$5.83

JPMorgan Chase

NYSE: JPM

$343.06

(+1.33%)+$4.50

Nvidia

NASDAQ: NVDA

$225.07

(+0.22%)+$0.49

UBS

NYSE: UBS

$49.67

(+2.50%)+$1.21

Robinhood Markets

NASDAQ: HOOD

$119.40

(-1.18%)-$1.42

BlackRock

NYSE: BLK

$1,086.31

(+1.20%)+$12.86

Bitmine Immersion Technologies

NYSE: BMNR

$27.56

(-1.68%)-$0.47

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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