Standard Chartered said that despite the second-largest crypto surged to $4,955 on August 25, Ethereum (ETH) and the companies that hold it at the Treasury Department remained undervalued.
Geoffrey Kendrick, bank head at Crypto Research, said the funds traded on finance companies and exchanges absorb almost 5% of all Ethereum that have been in circulation since June. The finance company bought 2.6%, while the ETF added 2.3%.
In total, that 4.9% stock represents one of the fastest accumulation stripes in the history of crypto, surpassing the speed at which Bitcoin (BTC)’s Treasury and ETFs won 2% of their supply in the second half of 2024.
Construction towards 10%
Kendrick said recent purchases mark the early stages of a wider accumulation cycle. In a July memo, he predicted that the finance company would ultimately have 10% control over all ether.
Kendrick argued that the goal appears to be achievable as companies such as Bitmine publicly target 5% ownership. He noted that this still plays a supply of 7.4%, creating a strong tailwind for Ethereum prices.
The sharp pace of accumulation underscores the growing role of institutional structures in the crypto market. Kendrick said ETF flows and financial purchase purchases highlight a feedback loop that can further strengthen supply and support higher prices.
Kendrick revised the lender’s previous forecast, saying Ethereum could rise to $7,500 by the end of the year. He also called the latest pullbacks a “great entry point” for investors who place the latest pullbacks ahead of further inflows.
Rating gap
Ether Hold companies’ valuations moved in the opposite direction while prices rose due to pressure purchases.
The net asset value (NAV) multiples of two most established ETH Treasury companies, Sharplink and Bitmine, are below double their largest Bitcoin financing firm, Strategy.
Kendrick said the discount is unfair given that ETH’s Treasury Department could win a 3% staking return, while the strategy would not generate such revenues on Bitcoin Stash.
He also pointed to recent plans to buy back SBET’s recent shares. He said that if that NAV falls below 1.0 it will produce a hard floor for evaluation.