Ethereum’s 2024 roadmap includes key upgrades that aim to improve efficiency and reduce costs, setting it apart from the more static design of the Bitcoin network.
Analysts at JPMorgan, the largest bank in the US, believe that Ethereum will reassert itself and outperform Bitcoin throughout 2024.
Nikolaos Panigirtzoglou, a JPMorgan analyst, wrote in a note on Wednesday, “We believe that next year Ethereum will reassert itself and recapture market share within the crypto ecosystem. The main catalyst is the EIP-4844 upgrade, or Protodanksharding, which is expected to take place during the first half of 2024.”
“Protodanksharding” is a preliminary version of danksharding, which is a major Ethereum scaling solution. Unlike standard sharding, danksharding uses “data blobs” (temporary data units attached to blocks), which are automatically deleted after 1-3 months, maximising data availability.
Related: Approved: Valkyrie to add Ether futures to existing Bitcoin futures ETF
The solution represents a crucial step towards Ethereum’s goal of scaling beyond 100,000 transactions per second, optimising costs and network efficiency.
Panigirtzoglou added, “We believe that this upgrade will likely prove a bigger step towards improving Ethereum network activity, thus helping Ethereum to outperform.”
As a proof-of-stake network, Ethereum is significantly more scalable than Bitcoin, which uses an energy-intensive proof-of-work consensus mechanism.
Since switching to proof-of-stake last year, the value of Ethereum has soared by 50%, climbing from $1500 to $2300 at the time of writing.
Scaling solutions such as Protodanksharding are particularly beneficial for Ethereum Layer 2 chains, such as Arbitrum and Optimism, which will benefit from reduced transaction fees.
Spot Ethereum ETFs are also likely to push the price
Spot Bitcoin ETFs have taken much of the limelight over the past few months, but the US Securities and Exchange Commission (SEC) also has a string of spot Ethereum ETFs on its desk.
The largest asset manager awaiting approval of its spot Ethereum ETF is BlackRock, which currently holds $8.5 trillion in AUM. Others include Cathie Wood’s ARK Invest, alongside Grayscale, which hopes to convert its Ethereum Trust into a spot ETF.
BlackRock’s Ethereum ETF, known as the iShares Ethereum Trust, plans to list on Nasdaq, with Coinbase as its custodian.
Read more: BlackRock’s Form S-1 filing: what we know about the spot Ethereum ETF so far
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