The Ethereum ‘Merge’ is still one of the most eagerly awaited updates in the crypto market. This merger would put the network on a completely different path by increasing the blockchain’s security and scalability. One question that investors continue to have is what effect this upgrading will have on the asset as a whole, and according to Bloomberg analysts, the cryptocurrency will only benefit from the merger.
Analysts Mike McGlone and Douglas Coutts recently put out a positive scenario for Ethereum in a recent article. This digital currency, which has recently emerged as a formidable challenger to Bitcoin, has been updating its network over the previous two years. This is part of an effort to transition the network away from the energy-intensive proof of work method and toward a proof of stake mechanism.
The Merge, which is expected to take place later this year, is a key milestone for the blockchain and, according to Bloomberg experts, one that will greatly increase interest in the technology. The simplicity with which users can participate in network activity is one explanation for this. Along with the many opportunities for users who choose to stake their tokens on the network to gain money.
Both analysts believe that digital asset is still significantly undervalued today. The experts explained, referring to the anticipated merger; “The upcoming merge, shifting Ethereum from a Proof-of-Work model to Proof-of-Stake, will convert Ether into an equity-like instrument with elegant supply/demand dynamics that could drive significant interest in the asset.”
Through various downtrends, Ethereum has continued to hold up in the market. Its widespread use cases remain one of the most convincing points for the future potential of cryptocurrency. It had hit an all-time high close to $5,000 last year but if the analysis from McGlone and Coutts is correct, then ETH is only beginning its trend.
At the time of writing, the digital asset was trading for more than $3,500. With a total market cap of $423 billion, it is now ranked second among the major cryptocurrencies by market capitalization.
There is every reason to believe that the digital asset’s price will benefit from the anticipated increase in interest after the merger is finalized. This is due to the digital asset’s increasing demand, which will increase its value over time.
Analysts not only believe in Ethereum’s future, but they also believe that the digital asset is now undervalued. Using a discounted cash flow model, they determined that Ethereum is still trading at 70% of its fair value, which is $6,100.