Coinbase the second largest cryptocurrency exchange has predicted a strong future performance for Ethereum

Coinbase predicts strong future potential for Ethereum as the second biggest cryptocurrency by marketcap has recorded a 29% increase since the year's start and a Potential ETF approval could boost ETH's price significantly. The US-based giant cryptocurrency exchange Coinbase stated in its latest announcement that Ethereum (ETH) might have the potential to perform above expectations in the near future. According to the research report published on May 15, despite ETH’s underperformance compared to the overall cryptocurrency market and its biggest rival Bitcoin (BTC) this year, it faces strong long-term expectations. Coinbase analyst David Han emphasized that ETH lacks major supply-side constraints such as token unlocks or miner selling pressure. Instead, he noted that the growth of staking and Layer 2 solutions has significantly absorbed ETH liquidity. These factors contribute to a positive outlook for ETH, indicating potential upward movement in the coming months. Moreover, ETH’s significant role in the decentralized finance (DeFi) sector stands out as another factor supporting its potential. The widespread adoption of the Ethereum Virtual Machine (EVM) and innovations in Layer 2 technologies strengthen its position. EVM allows developers to create smart contracts, and Layer 2 solutions help reduce scaling and data bottlenecks on the Ethereum Blockchain. Coinbase believes that it is unlikely for ETH’s role in DeFi to be challenged, ensuring its continued relevance and growth.

The Potential Impact of Spot Ethereum ETFs Awaiting Approval in the US The report also highlighted that the potential approval of spot Ethereum exchange-traded funds (ETFs) awaiting approval in the US could be a significant factor in boosting ETH’s price. Coinbase assesses that the market might be underestimating the timing and likelihood of such an approval. Experts suggest that even if these ETFs are rejected at the first deadline in May 2024, subsequent lawsuits could potentially reverse the decision, adding another layer of optimism for ETH investors. Beyond the potential ETF approval, Coinbase pointed to structural demand factors and technological innovations within the Ethereum ecosystem as fundamental factors supporting its long-term expectations. These elements ensure that the altcoin king remains relevant in various narratives within the cryptocurrency market, from DeFi to technological advancements.

source: https://en.coin-turk.com/coinbase-predicts-strong-future-performance-for-ethereum/