Key Insights

• Citigroup predicts that ether will fall to $4,300 by the end of the year; however, there’s a potential decrease down to $2,200 in a pessimistic scenario or a rise to $6,400 if market conditions are favorable.
• The growth in layer-2 solutions complicates the valuation of ether, with Citi estimating only 30% of layer-2 activity impacts Ethereum’s base layer, resulting in current prices that exceed their predictive modeling.
• Although exchange-traded fund (ETF) inflows are less than those for Bitcoin, they carry a more substantial price effect per dollar invested, albeit limited by ether’s smaller market cap and lower visibility to new investors.
• Market dynamics are expected to provide slight support, particularly as equities approach Citi’s target of 6,600 for the S&P 500, indicating no significant upside anticipated from risk assets.

“Network activity remains the key driver of ether’s value, but much of the recent growth has been on layer-2s.”
“La actividad de la red sigue siendo el principal motor del valor de ether, pero gran parte del crecimiento reciente ha sido en las layer-2s.”

For further details, read more about Ether’s potential.