Standard Chartered’s Head of Digital Assets Research Geoffrey Kendrick stated that Ethereum’s price could reach $40,000 in 2030, outperforming Bitcoin. Kendrick also said the next wave for tokenization, growth of stablecoins, and the institutional blockchain development is most likely to be on Ethereum.
Speak in a Milk Road interview Kendrick and John Gillen discussed how the traditional financial sector is approaching blockchain infrastructure. Kendrick’s argument wasn’t that Ethereum won because of the narrative momentum but because it looked like the most secure place for large banks, institutions and asset owners to begin building.
Ethereum could outperform bitcoin
Kendrick published an article titled Ethereum in January. outperformance expected. In an interview, he admitted that ETH had struggled with its price, but said it was still the same underlying system. “The interesting part here for Ethereum is as tradfi gets involved, tradfi is okay to build stuff on Ethereum,” “He said” “It’ll be very safe to say I’m going to build on Ethereum layer one, right? Because it’s never gone down. So I think a lot of this stuff in its first instance happens on Ethereum layer 1.”
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He pointed out BlackRock’s rollout strategy As a possible model of how this adoption might unfold. Kendrick believes that institutions will likely launch on Ethereum’s mainnet first, and then move onto other chains or layer-2s. It is crucial to understand the importance of this sequence, since Kendrick believes that value will be dispersed elsewhere before activity flows into Ethereum mainnet.
Kendrick stated that he is increasingly valuing ETH by considering the protocol fees and application charges relative to the market capital. He argued that more activity within the Ethereum ecosystem should lead to a higher price for tokens. “I think that means ETH outperforms now, let’s say for the foreseeable actually,” he added. He said that the ETH/BTC, currently 0.03 in his frame, could increase to 0.04 by this year. In the longer term, he added, “I have a lot of confidence in my ability to do this.” $500,000 Bitcoin by 2030 Ethereum will be worth $40,000 by 2030. This is clearly a major outperformance. The absolute upside potential from this point onwards could be massive.
This call has a broader basis, and that is tokenization. Kendrick stated that the value of stablecoins may rise to around $2 trillion in the coming years. This, he said, would increase demand for tokenized money-market funds. He said corporate treasurers will not hold tokenized cash, as the remainder of their idle funds are trapped in off-chain, slower systems.
“Tomorrow, if you want to get access to stablecoins because of their 24/7 instantaneous, near-free benefits, you want to take all the million dollars onchain,” Kendrick said. “You don’t want to go out of stable coins and back into idiotic fiat, which is ridiculously slow by comparison. Rather, you’d like to have all of your off-chain money market funds onchain as well.”
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It leads him to his biggest number call. The tokenized money markets funds which are currently around $10 billion could be up to $750 billion at the end of 2028. This was based on his assumption that, even if 10% of all transactions moved to stablecoins in the coming years, money market funds would still need an equal share on-chain. He forecasted that the value of other tokenized investments could increase from about $40 billion in today’s dollars to $2 trillion at the end 2028. This is a fifty-fold growth over three years.
Kendrick can see a way into DeFi from that point. He said that if regulatory clarity improved, DeFi and traditional finance could meet in the middle. Consumer-facing apps would use blockchain rails to move cash through products such as Aave or Morpho. “There’s a huge financial fairness and financial inclusion stuff that I think we circle back to from DeFi,” “He said” “Most people won’t know where it’s coming from, but you’ll get that style of stuff, I think, in the next few years.”
Kendrick believes that this is at the heart of Ethereum trading. Tokenized dollars, tokenized funds and tokenized equity will eventually pull liquidity from institutional sources on the blockchain. If this is true, then it’s likely that compliance teams would be most comfortable with a first-phase buildout. This still points towards Ethereum in his view.
As of press time, ETH was trading at $2,059.
Featured image was created with DALL.E chart by TradingView.com
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