Markus Thielen, head of research at 10x Research, said that if you are looking for a long target in 2025, Ethereum may not be the smartest investment choice because it may only bring mediocre returns compared to Bitcoin.
Other analysts are waiting for more conclusive signals from price trends to judge the next direction of Ethereum.
Ethereum is currently quoted at around $3,435.58. Markus Thielen said:
While new catalysts cannot be ruled out, we wouldn’t be surprised if Ethereum doesn’t see a major rally in the coming year.
Markus Thielen believes that in terms of mid-term prospects, Ethereum is a 'poor' investment. He pointed out:
Although we observe volatility in Ethereum's price, we believe it remains a 'poor mid-term investment' and expect Ethereum's performance to continue lagging behind Bitcoin in 2025.
Therefore, our stance on Ethereum remains clear: Don’t touch it.
He said that one of the most important indicators to watch in 2025 will be the trend of 'active validators.' However, he noted that the growth rate of Ethereum validators has turned negative, declining about 1% over the past 30 days, raising concerns that more validators may exit Ethereum.
Markus Thielen stated that the increase in canceling staked Ethereum is clearly 'logical' because Ethereum lacks 'real demand' outside of staking.
But others may disagree with this statement. For example, Attestant's Chief Business Officer Tim Lowe stated that the market demand for Ethereum can easily be increased through 'careful marketing' and 'unified value propositions,' which would naturally lead to an increase in Ethereum investors. For example, Ethereum can serve as a topic for 'diversified allocation' beyond Bitcoin.
According to CoinMarketCap data, since January 1, 2024, Bitcoin has surged 121.4%, while during the same period, Ethereum's return has only been 46.3%.
The Bitcoin spot ETF launched in the US on January 11 last year has seen strong demand, driving the coin price to a new high within two months; the Ethereum spot ETF launched in July has seen significantly less demand, leading to a more pessimistic market outlook for Ethereum.
Bitcoin ETF saw $35.3 billion in inflows last year, while Ethereum ETF only had $2.66 billion in inflows.
Markus Thielen said that Ethereum underwent the Duncan upgrade last March, which lowered Ethereum's transaction fees and processed more transactions, but this upgrade came too late, 'six months late,' and thus missed the peak of meme coins' surge, as the market had already shifted to the more cost-efficient Solana.
Additionally, he is skeptical about the Pectra upgrade scheduled to launch for Ethereum in early 2025:
Of the 19 upgrades Ethereum has undergone so far, only 2 have had a significant bullish impact on the price, and these upgrades occurred during cryptocurrency bull markets.
The three major catalysts for Ethereum in 2024 have essentially fizzled out, adding little overall value.
This analyst therefore believes that Ethereum's performance in 2025 may be inferior to Bitcoin.
However, other analysts believe it is too early to draw conclusions. For example, a cryptocurrency trader known as 'Cold Blooded Schiller' stated that Ethereum has been in a 'range-bound' since December 25, with only two possibilities ahead: one is an optimistic breakout; the second is a drop to the lower end of the range on December 20, retesting the $3,000 level.
Well-known analyst and founder of MN Capital, Michael van de Poppe, is more optimistic about Ethereum, believing it will show signs of a breakout in January. He stated, 'If the ETH/BTC exchange rate breaks 0.04 in January (currently at 0.03572), I would not be surprised.'
Matrixport warns: Ethereum faces severe challenges in 2025, with significant upward resistance.
"Will Ethereum start a 'catch-up rally' this year? This analyst says: Don’t touch it!" This article was first published on (BlockKe).
