Ethereum: The Unrivaled Settlement Layer Fueling On-Chain Finance's Expansion

Cryptocurrency
Written By Alexander I. Velasquez
Gold Ethereum coin with ETH logo in front of a green upward chart, symbolizing smart contracts and crypto market growth.

Photo Credit: © FellowNeko / Adobe Stock — used under Standard Editorial License.

Excerpt

The following is a 250-word excerpt from my full article on Seeking Alpha: A crowdsourced financial market content service where investors can share ideas, discuss news, and make informed investment decisions. To view the full article without a paywall, please click on the link below:
https://seekingalpha.com/article/4845437?gt=e65c415458d5817b

Summary

  • Ethereum remains the leading settlement layer for high-value on-chain activity, with fees, burn, and staking supporting long-term value growth.

  • Rollups, stablecoins, and real-world assets continue consolidating on Ethereum, expanding network demand and reinforcing its competitive moat.

  • Staking-enabled ETFs and the Fusaka upgrade provide major catalysts that strengthen Ethereum’s long-term outlook.

  • My valuation model indicates meaningful upside, with a base-case value near $5,000 and a bull-case value near $14,000 by 2030.

Investment Thesis

I assign Ethereum (ETH-USD) a buy rating because it is the leading settlement layer for high-value, on-chain financial activity that has its fees, burn, and staking tying its network usage directly to its native token, ETH, thereby increasing ETH's fair value over the long term. Ethereum also has a strong competitive moat amongst its faster, more centralized L1 rivals, such as Solana (SOL-USD) and Avalanche (AVAX-USD), because Ethereum is decentralized, has validator diversity, and has greater liquidity depth. And Ethereum's Merge has also strengthened its moat, considering that it has reduced its net supply and has linked its network security to real economic activity as opposed to having an inflationary model, such as Polkadot's (DOT-USD), that must continue to print tokens to maintain its security. With rollups, stablecoins, and real-world assets increasingly continuing to settle on the Ethereum network, its economic footprint continues to expand, and, over the next five years, staking-enabled ETFs and the upcoming Fusaka upgrade give the network two important catalysts that reinforce my long-term valuation given below…

Alexander I. Velasquez

Alexander I. Velasquez is a financial analyst specializing in valuation, market history, and long-term investing. His research combines fundamental analysis with lessons from past financial crises. His work is published on Seeking Alpha.

https://www.aivelasquez.com/
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