Ethereum to $9,200? 3 Shocking Reasons Why Altcoins Are Undervalued

Okay, let's talk crypto. You've probably heard the Bitcoin maximalists chanting their mantra: "Bitcoin is king! Everything else is noise!" Samson Mow, bless his heart, is one of the loudest. He goes so far as to claim that altcoin valuations are mispriced due to a factor known as “unit bias.”

Unit bias is the phenomenon where we’re happier just because we own more of something. That’s even true when their total wealth does not decline. Think about it: would you rather own 1 whole Bitcoin or 5000 of Dogecoin? Perhaps you would rather have 1 BTC, but altcoins simply make you feel like you have more. It's a psychological quirk, and Mow thinks it's holding altcoins back.

He points to Bitcoin’s scarcity – that hard-coded in 21 million coin limit – as the gold standard. So, by his estimate Ethereum might be expected to be worth $9,200, XRP $5,800, and Solana $3,400.

Here's the thing: I think he's onto something...partially. His conclusion – that it actually reinforces Bitcoin’s dominance? That's where I disagree. I too believe unit bias is depressing valuations, but not in the way he imagines. It’s leading people to ignore the real value and potential of these altcoins. It's time to ditch the Bitcoin-or-bust mentality.

Unit Bias Skews Perceptions Badly

Let's get visual. Imagine two companies: Company A has 10 million shares outstanding, trading at $100 each. Company B has 1 billion shares outstanding, and they trade at $1. Which is "cheaper"? Most people will instinctively say Company B. But guess what? Both of them are $1 billion market cap!

That's unit bias in action. Now, apply that to crypto. Bitcoin’s price is extremely high due to the lack of supply. Ethereum’s price should be lower given that its supply has increased. If Ethereum had Bitcoin's supply, the price could be astronomical.

It's not just about hypothetical numbers. It's about what these altcoins do. And that's where the real opportunity lies. Unit bias just causes people to focus on the sticker price, not the underlying technology and potential.

Bitcoin's Hamburger Versus Ethereum's Pho

Think of it this way: Bitcoin is like a plain hamburger. It’s beautiful, it’s traditional, it’s functional. It’s the new digital gold, the store of value. Ethereum? Ethereum is much more like a steaming bowl of Vietnamese Pho. It’s spicy, smoky, sweet, tangy, and just plain delicious, providing a deeply more interesting experience.

You wouldn’t evaluate the pho simply by comparing its cost to how many hamburgers you could purchase, would you. That wouldn’t do justice to the awesomeness of the pho! You’d think about the ingredients, the preparation, the service, the experience. The same logic applies to crypto.

Bitcoin's great, but its functionality is limited. It's a one-trick pony. Ethereum, in contrast, is a platform for millions of applications. It’s the backbone for all of DeFi, NFTs, the metaverse, and more. It's a whole ecosystem of innovation.

Altcoins Power Future Crypto Growth

This dominance of Bitcoin’s is being challenged in a major way, and the smart money is beginning to recognize just that. Here's why:

1. Smart Contracts Unlock Innovation: Ethereum's smart contracts are game-changing. They allow for the creation of decentralized applications (dApps) that can automate complex processes without intermediaries. This opens up endless possibilities for finance, supply chain management, and more. Bitcoin simply can't compete.
2. Developer Communities Thrive: Altcoins like Solana and Polkadot boast vibrant developer communities that are constantly pushing the boundaries of what's possible. These developers are building the future of the internet, and they're not doing it on Bitcoin. They are innovating and creating new use cases.
3. Real-World Use Cases Emerge: While Bitcoin is primarily a store of value, altcoins are finding real-world applications in various industries. From supply chain tracking to decentralized identity management, altcoins are solving real problems and creating tangible value.

The future of crypto is much more than a place to park value. It's about doing things. And that's where altcoins shine. Despite Bitcoin ETF inflows being incredibly positive for Bitcoin itself, this doesn’t indicate that other crypto projects aren’t a good investment.

Don't let unit bias blind you to the potential of altcoins. Bitcoin definitely has its place, but it’s not the sole route to crypto prosperity. Forget the market cap and price earnings ratio — judge each coin by its technology, its developer activity, and its adoption in the real world. The future of crypto is inclusive, and the smart money is past that… and already diversified. Ethereum to $9,200? Maybe. Maybe even higher. Yet the bigger value is in the innovation that these altcoins are pushing – taking one step backwards to do ten steps forward.

Past performance is not indicative of future results. Crypto trading is risky. Do your own research.