Macroeconomics guru and Real Vision co-founder Raoul Pal is predicting that Ethereum will surge to $20,000 this cycle.
In a Marco Insiders article, the former Goldman Sachs executive says that his models, including Metcalfe’s Law which states that the value of a network is directly correlated with its number of users, suggest that a crypto asset’s value is based on adoption.
Looking at Ethereum, Pal highlights that the leading smart contract platform’s market cap is highly correlated with its number of active addresses just like Bitcoin.’
Pal says the correlation between adoption and network value is not a coincidence.
He explains that Ethereum’s price distribution versus its number of active addresses mirrors Bitcoin’s exact performance at the same stage. He notes that Ethereum is six years younger than Bitcoin and that market participants will have to wait for the same network effects to kick in.