- ETH could displace Bitcoin’s dominance next year, one investor noted.
- Long-term investors have confidence in the altcoin’s performance.
According to Raoul Pal, Ethereum [ETH] will outperform Bitcoin [BTC] by 2024. Pal, who shared the view on X, noted that there could be a repeat of the 2021 cycle where BTC initially beat ETH’s performance.
But nine months later, ETH rose 245%, while BTC rose 45% during the same period.
It’s all about liquidity and the business cycle leading the risk curve. Story follows.
— Raoul Pal (@RaoulGMI) December 21, 2023
Pal’s position was not just his. But it was also that of Exponential Age Asset Management (EXPAAM).
EXPAAM is a digital asset investment management company co-founded by Pal, who also serves as CEO of Global Micro Investor. In defending his line of thinking, the investors noted that:
“It’s all about liquidity and the business cycle leading the risk curve. The story follows.”
This year, the price of Ethereum has increased by 92.04% as it changed hands to $2.3110. However, BTC’s performance was better, thanks to the increase of 163.21%.
As there were discussions about ETH’s enormous growth potential, AMBCrypto looked into the matter.
Indications of the Z-score from market value to realized value (MVRV). showed that the value was 0.61. The MVRV Z-score has historically been effective at identifying when market value is below realized value.
It is also shown when the realized value is above the market value.
Source: Santiment
Because the benchmark was less than 1, it means that the market value is well below the realized value. Therefore, buying ETH at this level has the potential to deliver great returns for investors.
Per price action, the Exponential Moving Average (EMA) showed that ETH’s value could grow exponentially over the long term.
At the time of writing, the 50 EMA (blue) had crossed the 200 EMA (yellow). This position is called a golden cross and is a bullis sign.
AMBCrypto then took into account Ethereum’s On Balance Volume (OBV), as shown in the daily chart. At the time of writing, the OBV had risen to 11.6 million.
The OBV measures buying and selling pressure. The increase therefore means that market players plan to increase the price in the short term.
Source: TradingView
Therefore, the recent report that ETH could soon reach $2,500 remains valid. However, the Moving Average Convergence Divergence (MACD) had turned negative.
The MACD value indicates bearish momentum. So there is a chance that the price of ETH falls below $2,300 before its potential value rises to $2,500.
Moreover, the Long Sternhouder NUPL (LTH-NUPL) has moved from hope and fear to optimism.
The LTH-NUPL is the net unrealized gain/loss taking into account only UTXOs with a minimum life of 155 days and serves as a indicator to assess the behavior of long-term investors.
Source: Glassnode
How much is 1,10,100 ETH worth today?
This view implies that the broader market believes that ETH’s performance would be better in 2024 than in 2023.
If the altcoin does that, Pal’s prediction can be considered concrete.