A report out Wednesday argues that the price of the Ethereum cryptocurrency may eventually climb as high as $35,000. Ether’s price has been stuck alongside bitcoin’s this year, but patient investors with a long horizon could be rewarded as Ethereum reclaims its dominance in crypto’s smart contracts space and new use cases emerge, according to Standard Chartered. In recent years, a wave of Ethereum competitors have emerged to challenge the flagship Web3 blockchain network’s high fees and slow processing times – like Solana , Cardano and Polkadot . Now, “layer 2” scaling solutions and new use cases are becoming “ever more important” and could help lift the price of ether 5x in the next three years before rocketing even higher, Standard Chartered said in a note Wednesday. “We expect further change ahead,” said Geoff Kendrick, an analyst at the London-based bank. “Layer 2 scaling solutions … are likely to grow in importance over time, particularly as architecture upgrades expected in early 2024 sharply lower fees on these platforms. This should help to cement ETH’s dominance in the smart contract space, thereby increasing its P/E ratio (if not its earnings) over the next couple of years.” “Layer 2” solutions like Arbitrum and Optimism are developed on Ethereum itself to enhance its efficiency and help keep transactions within the Ethereum ecosystem, rather than moving to a competing network in an attempt to find lower fees. Keeping activity on Ethereum should increase the token’s price-to-earnings ratio, Kendrick said. “We think Ethereum’s established dominance in smart contract platforms, along with emerging uses in gaming and tokenization, has the potential to push ETH to the $8,000 level by end-2026,” he added. That level is “a stepping stone to our long-term ‘structural’ valuation estimate of $26,000-$35,000,” he added. ETH.CM= 1Y mountain Ether (ETH) over the past year That valuation assumes future use cases and revenue streams that may not exist yet, Kendrick noted. He highlighted gaming and tokenization of real-world assets as the next big use cases for the network. Both could add demand to its existing NFT (nonfungible token) and DeFi (decentralized finance) channels, respectively, by giving “real world” companies and industries examples of how and why they could benefit from moving certain processes onto Ethereum. Standard Chartered expects “significant developments on these fronts by 2025-26,” Kendrick said. —CNBC’s Michael Bloom contributed reporting.