- Investors refuse bank deposits
- They will more actively choose to stake ETH
The price of cryptocurrencies has been falling lately and the bulls seem to be giving way to the bears. But analysts Bernstein Gautam Chkhugani and Manas Agrawal are very positive about the future prospects.
Now the market is experiencing an outflow of bank deposits due to their low profitability and the risk of bankruptcy. Savers are instead moving to the US Treasury money markets (where the rates are higher). But Bernstein expects ether staking to become more and more popular. Such a product offers high returns to investors.
Importantly, the US Treasury money markets are pegged to the dollar. This means that if this currency weakens, then profitability will also fall.
Unlike the dollar, ether is a deflationary asset. If the dollar collapses, then for some time the ETH rate may sink. After that, it will recover and resume the bullish cycle.
“This time, the reason for the new crypto cycle will be the profitability of Ethereum. Banks make money without sharing income with depositors. Ethereum shares everything it earns with stakers and does not dilute its monetary policy.”sums up the report.
Bernstein noted that ETH staking trends since the Shanghai update have exceeded expectations. The number of staked coins reached about 15% of the total Ether supply. After the fork, it increased by 2%. And this nullifies any theory that Shanghai will lead to an oversupply.