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According to a recent report from Steno Research, Ethereum (ETH) is poised to overtake Bitcoin (BTC) in 2025. This outlook is attributed to historical trends and the expected impact of favorable regulations on cryptocurrencies following the victory of the Republican presidential candidate Donald Trump in the November elections. .
Will 2025 be the year of Ethereum?
While the overall cryptocurrency market has reached unprecedented levels this year (reaching an all-time high (ATH) total market capitalization of $3.9 trillion), Ethereum, the second-largest cryptocurrency, has lagged behind in terms of performance. of prices.
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However, Steno Research report suggests that Ethereum could finally reach a new ATH in 2025, driven by increased institutional investment and supporting regulatory developments. The report predicts that ETH could climb to at least $8,000 in the next year.
Bitcoin is also expected to reach a new ATH of $150,000 in 2025, but Ethereum can more than double its current price of $3,400. Furthermore, the ETH/BTC trading pair is expected to rise from 0.035 to 0.06 over the next 12 months.
The weekly chart below illustrates the declining performance of ETH against BTC since September 2022. However, the pair now remains close to a crucial support level at 0.035, with expectations of a bounce to the 0.06 level, which It was last seen in February 2024.
Steno Research’s optimistic forecast for Ethereum underlines a potential bullish momentum for altcoins in 2025. Steno Research analyst Mads Eberhardt stated:
This expectation is partly based on the argument that Donald Trump’s US presidential victory is more favorable for altcoins than for Bitcoin.
The report adds that Bitcoin dominance (BTC.D), a metric used to measure the proportion of the total cryptocurrency market capitalization commanded by BTC, is expected to fall as much as 45% from its current level.
The weekly chart below demonstrates BTC.D’s sustained uptrend since September 2022, going from a low of around 39% to a high of 61%. However, the recent price action suggests that a lower high has formed, indicating a possible steep decline to around 45%.
DeFi activity will recover in 2025
The report further predicts a resurgence of decentralized finance (DeFi) activity within the Ethereum ecosystem in 2025. Specifically, the total value locked (TVL) in decentralized applications is expected to reach a new high of $300 billion on next year.
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Renewed interest in DeFi could further boost altcoin prices in 2025. In particular, ETH leap 10% following Trump’s election victory in November, as improving sentiment around DeFi regulations boosted market confidence.
Furthermore, strong inflows attracted by Ethereum spot exchange-traded funds (ETFs) increased further. strengthen the bull case for ETH heading into 2025. At press time, ETH is trading at $3,417, up 3% in the last 24 hours.
Featured image from Unsplash, charts from Tradingview.com
