When the road ahead seems blocked, a new path may suddenly appear.
Author: Anderson Sima, Foresight News
Since the beginning of 2024, if crypto enthusiasts were to make a list of the most disappointing crypto assets, Ethereum would undoubtedly top the list.
In the previous cycle, Ethereum shone brightly with new applications like DeFi and Non-Fungible Tokens (NFTs), reaching a historic high of $4,800 and creating a wealth-generating code with over 20x gains, while Bitcoin soared ahead. People's expectations for the "Ethereum killer" were also at their peak.
However, in the new cycle, while Bitcoin has already surpassed $90,000, Ethereum has barely managed to hold the $3,000 mark. Even after briefly reaching $4,000 at the beginning of the year, it once plummeted to the $2,200 level, trapping a large number of crypto enthusiasts who were eagerly awaiting Ethereum's performance. Even the "Sun Gege," who never loses, was among them, showing that institutional investors were not spared either. Currently, the exchange rate between Ethereum and Bitcoin has fallen to a historic low of 0.034.
"When the road ahead seems blocked, a new path may suddenly appear."
The author believes that the predicament Ethereum is currently facing is an inevitable stage in the early development of the Web3 industry. While Bitcoin has occupied the consensus high ground in the field of digital gold, Ethereum's vision of a world computer has encountered some structural contradictions, so it has not resonated with its market value and cannot realize its value expectations in the short term. However, the author believes that all the current difficulties are essentially paper tigers, and we are at the "dawn of a new era."
Ethereum's Predicament
The essential difference between this round of the crypto bull market and the previous two rounds is that Ethereum has not led the technological innovation trend. Compared to the ICO frenzy in 2017 and the DeFi Summer in 2020, the biggest highlight of this cycle is MEME, and the MEME community is mostly on Solana; Ethereum's leading Layer2 and reStaking concepts have actually had a negative impact on Ethereum's ecosystem.
Although the hundreds of Layer2 ecosystems have improved Ethereum's transaction experience and performance, they have also caused serious problems of flow diversion; the reduced Blob gas fees after the upgrade have also affected Ethereum's economic model and staking income. When ETH demand decreases and the burn rate is lower than expected, inflation begins to appear, which also weakens its potential as a value store; at the same time, Bitcoin is irreplaceable in the field of value storage for institutional investors, and the Ethereum spot ETH launched this year has become a lukewarm existence.
On the other hand, as a community leader, Vitalik's rationalist temperament has deeply influenced the entire ecosystem. Vitalik has a grand vision for Ethereum's future development, and he has recently written several long articles to conduct various studies on Ethereum's decentralization, security, and scalability.
However, from the community's perspective, some of these goals are too idealized and have a large gap with the current technical constraints and market expectations. At the same time, Vitalik has too much influence in Ethereum's community governance and decision-making, which is at odds with the ideal of decentralization, and may lead to an undemocratic and decentralized decision-making process, where the community's voice is inadvertently ignored, making him seem out of touch with the community's pursuit of wealth codes.
But isn't this just Vitalik? He is the one who cried over Blizzard's nerf of the Warlock skill, and then angrily entered the blockchain world to create Ethereum as a young man. If Vitalik becomes a non-stop shill and a decadent New Money, that might be the crisis the Ethereum community needs to worry about FUD.
Dawn of a New Era
Although the rise of MEME culture and Solana has attracted a lot of attention in this cycle, this does not mean that Ethereum has not made any technological innovations. While Layer2 and reStaking may have brought some challenges in the short term, they provide a foundation for the sustainable development of the Ethereum ecosystem in the long run: by reducing transaction costs and increasing transaction speed, Layer2 solutions make Ethereum more suitable for large-scale applications, which is crucial for attracting more users and developers.
Regarding the concerns about decreased ETH demand and inflation, the Ethereum community and developers are actively seeking solutions: the community is discussing further adjustments to EIP-1559 to optimize the ETH burning and issuance mechanism.
At the same time, although Bitcoin has an attractive appeal to institutional investors in terms of value storage, Ethereum provides a more comprehensive ecosystem, including smart contracts, DeFi, Non-Fungible Tokens (NFTs), etc. Ethereum and Bitcoin are complementary in many ways, rather than simply competing. Ethereum's multi-functionality gives it a unique position in the crypto currency field, supporting a wider range of application scenarios, which is something that no other public chain can match. The so-called "Ethereum killers" are not because Ethereum has problems, but because other public chains cannot replace Ethereum.
Ethereum's hope lies in its continuous technological progress, its strong developer community, and its ability to adapt to emerging market demands. However, in this cycle, Ethereum needs to focus on sustainable long-term development while also considering practical commercial applications that can be implemented, making each commercial application a stepping stone towards long-term thinking.
$10,000 is Not a Dream
The author boldly predicts that by the mid-2026 elections, Ethereum is likely to break through $10,000. Standard Chartered Bank analyst Kendrick reiterated Standard Chartered Bank's price target of $20,000 for Bitcoin and $10,000 for Ethereum by the end of 2025.
With the changes in the US political landscape and Trump's support for the crypto currency market, a large amount of traditional capital will flow into the crypto currency field. When traditional capital truly enters the crypto market, Ethereum, as a mainstream crypto asset with a spot ETF, is very likely to attract more capital attention.
According to Farside Investors data, on November 12, the net inflow of the US Ethereum spot ETF was $134.4 million, setting a historical best record.
The launch of the Ethereum spot ETF provides important financial support for the growth of Ethereum's price. ETF investors in the traditional market are usually long-term investors, and the increased liquidity of the spot ETF has increased the market's demand for Ethereum. For traditional investors who already hold Bitcoin, Ethereum, with its innovative potential and ecosystem effects, is also one of the best channels for them to enter the crypto currency, which will further accelerate Ethereum's transformation into a mainstream investment tool.
As for the Layer2 flow diversion problem, as the Ethereum mainnet experience gradually improves and the competition subsides, we may see more L2 solutions integrated into the Ethereum mainnet. The smooth progress of this process will provide stronger traffic support and gas fee income for Ethereum, relieving inflationary pressure and making Ethereum's economic model more robust.
It is expected that in the first half of 2025, the progress of Ethereum's L2 integration will gradually enter the substantive implementation stage, some Layer2 will be eliminated, and L2 integration will attract more developers and users back to the mainnet, thereby driving the prosperity of the Ethereum ecosystem. During this stage, the price is expected to stabilize in the range of $3,000 to $5,000.
In the coming years, innovative applications such as PayFi and Real-World Assets (RWA) are expected to continue to grow, especially after the improvement of smart contract functionality and the gradual improvement of L2 solutions, more complex financial applications will emerge. The birth of these applications is expected to re-ignite market demand for Ethereum.
For example, the integration of cross-chain liquidity based on L2 and the maturity of on-chain financial derivatives markets will bring a large trading volume, further enhancing Ethereum's value. RWA and payments that interact with traditional assets are potential killer applications. It is expected that in the second half of 2025, these emerging applications will drive Ethereum's value to break through $6,000 to $8,000.
As the influence of pro-cryptocurrency politicians like Trump in the United States increases, the US cryptocurrency market is expected to gradually see a more relaxed regulatory environment in the future. Additionally, the risk of a global economic slowdown and fiat currency inflation will lead more investors to consider digital assets as a hedging tool, further increasing the demand for the cryptocurrency market.
If the United States and other major economies gradually relax regulations on cryptocurrencies in the next 1-2 years, and global investors' demand for hedging against inflation and fiat currency depreciation increases, this will provide strong macroeconomic support for the rise of Ethereum's price. It is expected that in early 2026, under favorable market conditions, Ethereum may see a major price breakthrough and reach the $10,000 mark.
Recently, Vitalik was interviewed by Foresight News, where he said, "The only surprise is that if Ethereum as an asset is not known to anyone, it cannot succeed, so from this perspective, Ethereum cannot be a mere background." Ethereum's ambition is known to people.
