As bitcoin reaches for its all time high of $20k, it is time to take a serious look at ether (ETH). Ether has a much longer journey to its all time high of $1392, and many investors believe it outpace bitcoin's rise because of ether's wider set of use cases.
I'll make the case here for $1000 ether in 2021. Personally, I do believe it can happen, especially if many of the variables below do actually occur.
1. The circulating supply of ETH should fall throughout 2021. Ethereum staking will reduce the circulating supply of 2021. Although I gave the Ethereum Foundation hell for screwing up the rollout of direct staking, I do believe that 2021 will see the minimum stake met and the rollout of the Beacon Chain. The more ETH that is locked up, the less there will be on exchanges to trade. However, keep in mind that the Foundation can create an unlimited supply of ether. There is nothing stopping them from flooding the market other than basically ruining the best thing to happen to finance since money.
2. Noobs will see ETH as separate from bitcoin (BTC). Investment in Grayscale's Ethereum Trust is keeping pace with its Bitcoin Trust, believe it or not. This means that people are beginning to learn about the differences between ether and bitcoin. The new generation of adopters in crypto will be better educated about Ethereum and may move into it directly, instead of using bitcoin as the singular on ramp.
3. Banks will continue to drive people with discretionary income towards defi. Inheritance continues to flow into the hands of Millennials from Baby Boomers and Silent Generation parents and grandparents. The Great Transfer may well be over $60 trillion once all is said and done. These Millennials are much more in tune with the potential of crypto than their older counterparts. They are also much more leery of tradfi. As a result, defi will see a boom. Ethereum, as the top network for defi, will flourish.
4. Institutional investors are looking for gains. There is talk of negative interest rates for checking and savings accounts. Companies with tons of cash are watching that cash being debased through quantitative easing and talk of even more pandemic stimulus. These whales will need somewhere to park their money for consistent gains, and more and more of them are viewing it as irresponsible to not at least consider defi.
5. The defi community is creating a standard. The defi infrastructure is becoming stronger, with less tolerance for scams even without overbearing regulation. As the defi community continues to demand a standard from its devs, and devs have more examples of projects that are more profitable than scamming, mindshare will turn towards building rather than profiteering. This will invite more institutional investors, retirees and noobs into the space. The Ethereum community is especially strong, holding the project together even as other networks far surpass it in technical prowess.
6. The remote economy is growing. With COVID cases rising and people becoming more accustomed to social distancing, the remote economy looks to expand in 2021. Look to see many more people fumble their way into defi as a matter of necessity when they cannot find jobs or even travel outside of their cities freely.
7. A 2X is nothing in crypto. You can't really think of a 2X in crypto like a 2X in a stock. The market for the entire crypto space is 90X less than stocks, so it takes much less money to move the market up. Jeff Bezos alone could double the total market cap for ether with 1/3 of his personal wealth. Not Amazon's cash, mind you — his personal holdings.