Author: Juan Leon, Senior Investment Strategist at Bitwise; Translated by: 0xjs@Golden Finance
In 2024, two key narratives dominated cryptocurrency headlines: Bitcoin's rapid rise driven by the launch of Bitcoin ETFs and record inflows; and Solana becoming a retail favorite, driven by meme coin speculation.
This has largely overshadowed Ethereum — the world's second-largest crypto asset. Of course, from an absolute perspective, its 66% return so far this year is decent, but it pales in comparison to Solana's 106% and Bitcoin's 130%.
But some interesting things have happened recently: investors have begun to take an interest in Ethereum again over the past 10 days.
You can clearly see this in the spot Ethereum ETFs, which attracted up to $2 billion in net inflows during this period. In contrast, the same ETFs had net inflows of only $250 million in the first four months.
So what happened here?
As I reviewed Bitwise's recent 2025 crypto predictions, I suddenly realized this. In various price forecasts, we presented several 'real-world' trends that we believe will shape the industry in the coming year, from the continued rise of stablecoins to the surge of AI agents trading with cryptocurrencies.
But one of the biggest and most easily overlooked opportunities focuses on tokenization: the process of bringing the vast real-world asset (RWA) market onto the blockchain.
Today, the market is dominated by Ethereum.
"This is not just a story for tomorrow"
Tokenization refers to the process of digitizing traditional financial assets (such as government bonds or real estate) into tokens that can be traded on the blockchain. Tokenization is expected to make the buying, selling, and settlement of financial assets faster, cheaper, and more digital. Many believe it could disrupt the fundamental basis of how financial markets operate.
This is not just a story for tomorrow. Tokenized assets are currently experiencing rapid growth, with companies like BlackRock and UBS bringing tokenized real-world assets to the network, covering government securities, commodities, real estate, private equity, and more. For example, BlackRock has a $578 million tokenized government bond fund and is looking to do more. We believe tokenized fund assets will triple next year, with Ethereum being the driving force behind it.
Why Ethereum?
To use an old saying: you won't get fired for building on Ethereum.
Ethereum is the most battle-tested, secure, and decentralized platform among smart contract platforms. Since its establishment in 2015, it has become a leader in decentralized applications, smart contracts, and tokenization. It currently holds an 81% market dominance in the tokenized asset market, and its long track record and large distributed validator network give asset managers confidence in its security and reliability when transferring assets to the blockchain.
The thing is: it is hard to overstate how large the RWA market is. The global value of real-world assets is approximately $100 trillion. Most of these assets will take time (perhaps decades) to transition to a tokenized track. But if that is the case, the fees associated with RWA assets could exceed $100 billion annually. This is more than 40 times Ethereum's total fees of $2.4 billion so far this year. With the upcoming pro-crypto SEC expected to provide the regulatory clarity needed to accelerate tokenization, investors betting on Ethereum could see substantial returns in the near future.
This is just one of the many reasons we believe 2025 will be the year Ethereum returns to its peak.
