In this bull market, the performance of ETH has not been as strong as expected, and it has not yet broken through the previous bull market high, and even reaching the $4,000 level has been somewhat difficult. In contrast, BTC has repeatedly hit new highs, even once breaking through $108,000, causing the ETH/BTC ratio to continue to decline...
However, with the new year approaching, more and more analysts are optimistic that ETH will regain its glory this year, and we will summarize their views and related data for you below.
Ether ETF Sees 8 Consecutive Weeks of Net Inflows
First, in terms of ETH spot ETFs, the previously sluggish trading has improved since November last year, and it has now achieved 8 consecutive weeks of net inflows, reaching $2.6 billion in December.
Although it is still lagging behind the BTC spot ETF (net inflows of over $35 billion in 2024), some analysts believe that this situation may be reversed in 2025, especially if the price performance of ETH is strong and the regulators allow the funds to generate income by staking ETH.
Three Reasons Why Ethereum May Reach New Highs Next Year
Against this backdrop, Eugene Ng Ah Sio, a cryptocurrency trader with over 110,000 followers on X, posted last weekend that there are three reasons that will make ETH the biggest beneficiary in the first quarter of 2025:
1. Ethereum's price increase is significantly lagging behind: The price of BTC has risen 40% from its previous all-time high (ATH), while ETH is still 30% below its ATH. Although this does not have much indicative significance in itself, as both have ETF products, for the general public, ETH appears cheaper than BTC, and is therefore more likely to be seen as having upside potential.
2. Trump's pro-crypto policies: The Trump administration has been the most friendly towards assets with utility and smart contracts. We have seen some DeFi assets (such as AAVE and UNI) perform well due to market expectations, but the biggest beneficiary is still ETH. Trump's WLFI did not involve the Solana domain, but continued to choose ETH-based assets, and Eugene believes this trend will continue.
3. The development of the Base ecosystem: Among all the ETH Layer 2 networks, Base is the standout chain this year. Leveraging Coinbase's native distribution channels and the AI agent ecosystem driven by Virtuals, Base offers a value proposition very similar to Solana, and can undoubtedly be classified as a competitor. Since Base itself does not have its own token, the natural demand for the underlying asset ETH will increase, and the growth of the ecosystem activity will bring more positive inflows.
Driven by these three factors, Eugene expects ETH to break through $4,000 as early as next January, and to reach a new all-time high in the first quarter.
10x Research：Ethereum Unlikely to See Meaningful Rebound in 2025
However, not all analysts are optimistic. Markus Thielen, head of research at 10x Research, said that ETH may not be the wisest investment choice for the 2025 bull market:
While we cannot rule out the possibility of new catalysts, we would not be surprised if ETH fails to achieve a meaningful rebound next year...
Thielen believes that ETH is still a poor medium-term investment, and expects ETH's performance to lag BTC again in 2025. He pointed out that the growth rate of ETH validators has turned negative, declining by about 1% in the past 30 days, raising concerns about the increasing risk of more validators exiting the network.
Although I believe that the decline in the number of validators will not pose too much concern for network security in the short term, and that the possibility of funds being able to stake ETH after Trump's inauguration is also promising; I also understand that the market's understanding of Ethereum's positioning is indeed more difficult than that of Bitcoin, and the constant emergence of L1 and L2 public chains is indeed putting competitive pressure on Ethereum.
How will ETH develop in the new year? ABMedia will continue to track it for you.
