Today, the price of Ethereum (ETH), reached an all-time high of $ 2,487. And although the price has tripled since early 2020, the current speculative premium suggests that there is a lot of room to rise. So, could it be worth $ 5,000 in May?
Now, the current price of Ethereum is around $ 2,460 and the price realized, i.e. the average price paid by all investors currently holding Ethereum, is at $ 802.
This means that current Ethereum (ETH) buyers are willing to pay 3.04 times the price of what all current holders have paid on average for their Ethereum. Since, although this may be high, this multiple became 6 in the last bull market.
In effect, to reach this multiple, the Market Value of Ethereum (current price of ETH) is divided by the Realized Value (what all current holders paid on average for their Ethereum).
In short, this multiple is called ratio MVRV and was created by David Puell and Murad Mahmudov.
What is the MVRV ratio? Could it reach 5 by the end of May?
To better understand, MVRV( Market Value to Realized Value), is a ratio of market capitalization of an asset to its realized capitalization.
In short, this relationship can be used to help evaluate the maximum and minimum values of the Ethereum market. Also, as to provide valuable information on the buying and selling behavior of merchants.
In particular, if the uptrend were to hold and there was a rebound in the MVRV ratio, a multiple of 5 could eventually be reached by the end of May.
And what’s better, as there are more buyers in the market, the price realized is expected to increase over time. In the last month alone, it increased by 15.1%.
That is, projecting this until the end of May, the Realized Price could increase by 26.43% to about $ 1,014 per Ethereum. Therefore, based on a multiple of 5, this would result in a market price of $ 5,070 per Ethereum.
Looking ahead for Ethereum (ETH)
Thus, this projection is a real possibility, especially with Ethereum and Bitcoin hitting new all-time highs on a regular basis. It should be noted, that there are no guarantees regarding price and time targets.
The truth is, earlier this year, Bitcoin trader Josh Olszewicz set his short-to-medium-term Ethereum target price at $ 780.
Also, another short-term prediction from Blockfyre co-founder Simon Dedic sees Ethereum at $ 800.
However, there are chances that the bullish scenario has a good chance of happening. But, there is still a lot of work to be done. Do you think $ 5,000 crazy for an Ethereum by the end of May? Let it know in the comment box.
I close with this phrase by Mark Cuban: “I think investors should buy more Ethereum than Bitcoin. Ethereum is a real currency».