In the most recent investor letter published by the company, cryptocurrency investment firm Pantera Capital disclosed that it has a “overweight” position on Ethereum. The investment firm is of the opinion that Ethereum is undervalued in comparison to Bitcoin despite the fact that, at the time of this writing, its price had dropped by more than 35 percent from its all-time high.
Given that Bitcoin’s dominance has been trending on the higher end of its range, of above 70% of late, and that the bull market is likely to continue for some time, it is likely that people will take some of their Bitcoin gains and roll them into Ethereum. Given that Bitcoin’s dominance has been trending on the higher end of its range, of above 70% of late, and that the bull market is likely to continue for some time.
According to Joey Krug of Pantera Capital, the upcoming launch of CME ETH Futures, which are offerings that will legitimise Ethereum as something that institutional investors can own, will further the case that ETH is undervalued. This launch is scheduled to take place next month. This launch, in conjunction with the fact that an increasing number of holders are staking ETH on Ethereum 2.0, has the effect of lowering the amount of sell pressure on the price of the alternative cryptocurrency.
“The combination of these two factors, along with the fundamentals of the cryptocurrency and its historically low valuation in comparison to Bitcoin, should put a lot of positive pressure on the price of Ethereum in 2021,”
Given that ETH is the base money collateral for this new financial system, it was also mentioned by Krug, who is the co-CIO at Pantera, that the expansion of DeFi has already had and will continue to have a positive impact on the price and fundamental value of ETH. This was another point that Krug made.
“I believe that this growth will continue throughout the course of this year, and Ethereum will provide even more value for cryptocurrency users as a platform for decentralised exchanges (DEX’s), lending protocols, and synthetic asset trading protocols,”
The success of such DeFi protocols is highlighted by the fact that Aave and Synthetix recently broke into the top-20, surpassing Tezos and Tron on the way. This highlights the significance of the success of such DeFi protocols. In point of fact, many people believe that more DeFi coins will be included in the top 20 cryptocurrencies by market cap in the year 2020. This is a development that will continue to add to the bullish case for ETH.