When Ethereum (ETH) reaches $154,000…

$154K ETH 👀

1973: the OPEC oil embargo targeting the West created an overnight supply shortage.

Oil prices quadrupled globally.

1983: the must-have Christmas toy Cabbage Patch Kids saw frantic parents fighting – sometimes violently – over scarce remaining dolls.

Both Black Friday and the term “mass adoption” spawned from the Cabbage Patch Kid phenomenon.

Housing (2000s). Bourbon (2010s). Toilet paper (2020). Lithium (2021). Semiconductors (2022 – ).

According to some analysts, Ethereum could be next.

Two words:

Supply shock.

In a report titled “ETH 2030 Price Target and Optimal Portfolio Allocations,” VanEck outlined potential scenarios that have Ethereum’s price eclipsing $150,000 per token by the end of this decade.

Bold? Yes. BUT…

The prediction reveals the supply and demand dynamics poised to supercharge Ethereum’s value in the years ahead.

Two years ago, Ethereum upgraded to a lesser-known deflationary burn mechanism which destroys ETH used for transaction fees.

The more Ethereum is used, the more Ethereum is burned.

Ethereum hasn’t really seen a raging bull market with this burn mechanism in place.

Adding fuel to this potential fire:

Since the recent approval of Ethereum ETFs on May 23rd, over $3 billion worth of ETH has been siphoned off centralized exchanges and into cold storage.

This follows $500 million exiting exchanges in a single April week, leaving just 10.6% of the total circulating supply readily available on trading platforms – the lowest levels in 6 years.

When (not if) the ETFs soak up more of this dwindling supply, the stage is set for a buying frenzy exacerbated by Ethereum’s burn mechanism.

That’s the case VanEck is making.

They’re not the only ones.

K33 Research forecasts up to 1 million ETH, worth over $4 billion at current prices, could be absorbed by U.S. ETFs upon launch.

This would represent 1% of total supply.

But that’s not all.

Don’t forget about staking.

Another compounding factor is the appeal of staking and “re-staking” Ethereum for yield rewards.

Though Ethereum’s staked supply has grown 78% post-Shanghai upgrade, only 27% is currently locked – a fraction compared to other blockchains like Solana at 81%.

Each additional ETH removed from circulation amplifies the supply vacuum.

When coupled with demand from newly launched ETFs, Ethereum appears poised for a self-perpetuating supply shock cycle.

Ethereum’s scarcity tailwind strengthens further if the SEC ultimately permits ETFs to stake and earn yield, generating fresh incentives for accumulation by wealth managers.

While VanEck’s $154K prediction seems outlandish today, Ethereum’s confluence of dwindling supply, soaring institutional demand, and deflationary burn mechanics could…

As they say in crypto…

Melt faces.

VanEck’s bullish $154,000 forecast represents a near 40x increase from current levels around $3,800. Even their “base case” of $22,000 would be a 6x rally for the blockchain’s native asset.

Three ways to play it.

As far as we’re concerned, there are three ways to play Ethereum’s rise.

One, you could simply buy Coinbase stock, COIN.

Coinbase will undoubtedly benefit from Ethereum’s monumental rise. Especially if it is the main custodian for the ETFs. (Likely.)

Second, you could buy Ethereum (ETH). Obvious.

Third, you can get into the moonshot play to make way more if the stars align for ETH.

See…

If ETH and COIN succeed, this new coin will feed off of their success and go up many times over.

In fact, it might even be crucial to their success.

Author: Chris Campbell

Source: AltucherConfidential