As the crypto market navigates its way through the latter half of 2024, analysts are increasingly focusing on the prospects for a bull run in 2025. With Ethereum (ETH) facing a lukewarm reception from investors, some experts are cautioning that the asset may not be the wisest investment choice for a potential rally next year.
Ether’s Performance in 2024: Underwhelming Returns
Markus Thielen, head of research at 10x Research, expressed his concerns about Ethereum’s performance in an interview. He noted that Ether has delivered underwhelming returns compared to Bitcoin (BTC) this year, with a modest 46.3% gain against BTC’s impressive 121.4% increase since January 1st.
Active Validators: A Key Metric for 2025
Thielen highlighted the trend in active validators as one of the most important metrics to watch in 2025. However, he expressed concern that the growth rate of validators has turned negative over the past 30 days, dropping by around 1%. This trend raises worries about the increasing risk of more validators exiting the network.
Rise in Unstaking: A Logical Outcome
Thielen argued that a rise in unstaking seems logical due to Ethereum’s lack of "real demand" outside of staking. He noted that the Duncan upgrade in March, which reduced gas fees and allowed for more transactions, arrived six months too late to capitalize on the memecoin rally.
Pectra Upgrade: A Mixed Bag
Thielen also expressed skepticism about the Pectra upgrade, due to be introduced in early 2025. He pointed out that only two of the 19 upgrades so far have had a notable positive impact on price, and even those occurred during Bitcoin bull markets.
Ether’s Price: Uncertain Prospects
While Thielen believes Ether may continue to underperform against Bitcoin in 2025, other crypto analysts say the asset’s price remains uncertain and could move in either direction. Pseudonymous trader Cold Blooded Schiller predicted that Ether has been "rangebound" since December 25 and one of two scenarios is likely to play out:
- Optimistic Scenario: Ether might stage a "sweep and run" to the upside, triggering a price breakout.
- Bearish Scenario: Ether could break down to the December 20 range low, potentially retesting the $3,000 level.
Other Analysts Weigh In
Echoing a similar scenario, pseudonymous trader Dal said Ether could go in one of two directions:
- Bearish Scenario: If Ether fails to flip $3,554, it may drop back to $4,000.
- Bullish Scenario: However, if Ether can break through $3,554, it may sweep down to $3,102.
On the other hand, MN Capital founder Michael van de Poppe is more bullish on Ether and said it is showing signs of breaking out relative to Bitcoin in January 2025. He predicted that he "wouldn’t be surprised if $ETH / $BTC breaks through 0.04 in January."
Conclusion
As the crypto market navigates its way through the latter half of 2024, analysts are increasingly focusing on the prospects for a bull run in 2025. While some experts caution that Ethereum may not be the wisest investment choice due to its underwhelming returns and lack of "real demand" outside of staking, others say the asset’s price remains uncertain and could move in either direction.
Whether Ether will stage a "sweep and run" to the upside or break down to the December 20 range low remains to be seen. As always, investors should exercise caution and do their own research before making any investment decisions.
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This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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