By Tom Mitchelhill
Compiled by: Daisy, Mars Finance
Ethereum supporters say the rise of AI agents, major network upgrades, increased institutional interest and sweeping regulatory reforms brought about by new U.S. President Donald Trump’s crypto-friendly administration are all reasons to look forward to 2025.
Infinex founder Kain Warwick said that although Ethereum’s performance was slightly flat in 2024, the asset was like a “compressed spring” and was ready for a breakthrough in 2025.
According to TradingView data, ETH (Ethereum) has risen 53.5% so far this year, rising from $2,350 on January 1 to $3,478 at the time of writing.
Source: TradingView
Meanwhile, other major crypto assets including Solana, Cardano and Ripple’s XRP are up 92.7%, 57% and 276.5% respectively this year. Warwick said:
The longer you hold it down, the harder it bounces back. There are a lot of tailwinds, and there are some constraints, but once it breaks through, people are going to be like, "Oh shit."
Source: Kain Warwick
He mentioned some Ethereum Improvement Proposals (EIPs) and the user experience improvements brought by these upgrades, believing that these are key turning points in the price trend of Ethereum and ETH.
In 2025, I think we'll see improvements in account abstraction, a lot of progress in L2 interoperability, and a huge improvement in the user experience between L2s.
Ethereum will usher in Pectra upgrade in 2025
One of the major upgrades that Warwick and other Ethereum supporters are eagerly anticipating is the Pectra upgrade—the next major milestone on the Ethereum roadmap, expected to launch in early 2025.
Gaia Regis, co-founder and CEO of restaking platform Byzantine, said the Pectra upgrade will fundamentally change the way Ethereum’s security layer operates.
“Currently, Ethereum staking relies primarily on liquidity. Essentially, many ETH holders want to participate in staking. This is generally a good thing, as more nodes mean more decentralization and higher security,” she said.
However, Regis said Ethereum has now reached massive scale — more than 1 million Ethereum validators communicating among themselves — which is starting to slow down the network.
“Pectra solves this problem by increasing the maximum valid validator balance from 32 ETH to 2,048 ETH, thereby significantly reducing the number of validators required and reducing the strain on the network,” Regis said.
Less stress means a faster network and a better experience for Ethereum users.
In September this year, Ethereum core developers decided to split the Pectra upgrade into two major packages. The first Pectra suite will introduce a total of eight EIPs, the most important of which is EIP-7702, designed to improve the user experience of wallet and chain abstractions.
“This will make staking cheaper, causing more people to participate in staking, thus reducing staking rewards over time. Because of this, we are extremely bullish on restaking. Many people will want to be guaranteed by other networks to increase their staking rewards.
Trump’s Crypto-Friendly SEC Would Particularly Benefit ETH
Saul Rejwan, managing partner of crypto venture capital firm Masterkey, said in an interview with Cointelegraph that Ethereum and more “legitimate” projects in the crypto industry, especially decentralized finance (DeFi) and decentralized physical infrastructure (DePIN) ), will benefit most under a Trump administration and a more crypto-friendly U.S. Securities and Exchange Commission (SEC).
On December 4, Trump nominated pro-cryptocurrency businessman and former SEC Commissioner Paul Atkins as the next SEC Chairman, while current Chairman Gary Gensler plans to resign on January 20.
“DeFi projects on Ethereum will flourish in a more favorable regulatory environment, and areas like restaking only need a little regulatory push to attract institutional investors,” he said.
We expect this new leadership will lower barriers to entry, making it easier for early-stage crypto entrepreneurs and resilient companies to innovate and succeed.
Stablecoins, tokenization and AI agents
Matt Houghan, Chief Investment Officer of Bitwise, said that Ethereum has three major advantages as it enters 2025 and expects the asset to explode in the new year.
“Ethereum is at the center of three of the biggest trends in the crypto industry: the rise of stablecoins, tokenization, and AI agents. It has dominant market share in all three areas,” Houghan said.
He added: “I think the excitement in these three areas next year will impact Ethereum, making it the comeback king of 2025. You can already see this in the recent strong performance and ETF inflows. "
Ethereum ETFs have seen net inflows of $1.5 billion over the past two weeks, one of the largest periods of inflows among the eight spot ETFs, according to data from Farside Investors.
Source: Farside Investors
Like Rejwan, Houghan also believes that the new crypto-friendly SEC under Trump will be particularly beneficial to Ethereum.
“I’m looking forward to lifting the ‘Sword of Damocles’ that has hung over the U.S. crypto industry for the past four years. Washington’s new approach will unleash millions of crypto entrepreneurs, many of whom will build on Ethereum and its Layer 2 Build killer applications on top of it," Houghan said.
We are entering a golden age of crypto, and Ethereum will be one of the main beneficiaries of this boom.
Houghan said that overall, Bitwise expects ETH to surpass the previous all-time high price of $4,878 and reach what he described as a "conservative" forecast high of $7,000.
More Layer2, heavy staking, and better DApps
Edu Timmers, an Ethereum supporter and chief marketing officer of crypto company Keyrock, believes that with the release of new Layer 2 projects such as Abstract and Deutsche Bank projects, this will increase the widespread adoption of the Ethereum ecosystem.
Timmers also mentioned that the recent rise of Hyperliquid, an on-chain perpetual contract protocol built on Arbitrum, proves the growth of Ethereum’s dominance on the chain, saying that he expects Ethereum and its decentralized application (DApps) ecosystem to Will start competing with centralized market leaders like Binance in the new year.
“Projects like Hyperliquid will start competing with centralized players like Binance in 2025, rather than decentralized projects like Uniswap,” Timmers said.
In addition, Timmers said that Ethereum restaking is another undervalued area worth paying attention to in 2025, saying that it will make the network more robust and versatile.
Heavy staking may see a breakthrough as the chain begins to move security to the Ethereum mainnet through solutions like EigenLayer.
(The above content is excerpted and reprinted with permission from partner MarsBit, original text link)
Statement: The article only represents the author's personal views and opinions, and does not represent the objective views and positions of the blockchain. All contents and opinions are for reference only and do not constitute investment advice. Investors should make their own decisions and transactions, and the author and Blockchain Client will not be held responsible for any direct or indirect losses caused by investors' transactions.
"Ethereum 2025 Outlook: Can ETH break through all-time highs?" This article was first published on (Block Guest).
