10x Research’s head of research, Markus Thielen, says Ether might not be the wisest investment choice for the 2025 bull run, speculating that the asset could deliver underwhelming returns compared to Bitcoin.
Other analysts say it could go both ways and are waiting for more confirmation from the price chart to see which way it will go.
“While the possibility of a new catalyst cannot be ruled out, we wouldn’t be surprised if Ethereum struggles to deliver meaningful rallies next year,” 10x Research head of research Markus Thielen said in a Dec. 30 market report.
Ether a ‘poor’ investment for the medium term, says analyst
“While we appreciate Ethereum’s volatility, we believe it remains a poor medium-term investment and expect ETH to underperform BTC once again in 2025,” Thielen said.
“As a result, our stance on Ethereum remains clear: ‘avoid.’”
Thielen says one of the most important metrics to watch in 2025 will be the trend in active validators. However, Thielen noted that the 1-month growth rate of validators had turned negative, dropping by approximately 1% over the past 30 days, raising concerns about the increasing risk of more validators exiting the network.
Ethereum active validators vs 1 month change in validators chart. Source: 10x Research
Thielen said a rise in unstaking seems “logical,” arguing that Ethereum lacks “real demand” outside of staking.
Others would likely disagree with that statement.
Attestant’s chief business officer Tim Lowe recently told Cointelegraph that demand for Ether can easily increase with refined marketing and a unified value proposition, which will naturally see it accrue more investors over time.
Lowe sees diversification from Bitcoin as a simple catalyst for Ethereum.
Ether underperformed against Bitcoin
While Bitcoin (BTC) is up 121.4% since Jan. 1, Ether clocked a 46.29% return over the same period, according to CoinMarketCap data.
On Jan. 11, spot Bitcoin exchange-traded funds (ETF) launched in the United States, which was met with high demand and helped push Bitcoin’s price to new highs just two months later. Although Ether ETFs also launched in the US in July, the demand was significantly lower than Bitcoin ETFs, leading to a more bearish view on the asset.
Bitcoin ETFs saw $35.27 billion in inflows across the year, while Ether ETFs reached $2.66 billion.
Thielen said that the Duncan upgrade in March — which reduced the network’s gas fees and allowed it to handle more transactions — “arrived six months too late,” arguing that it missed the peak of the meme coin rally, and the market “shifted” to the “more cost-effective” Solana (SOL) alternative.
He is also skeptical of the Pectra upgrade, which is due to be introduced in early 2025.
“Of the 19 upgrades so far, only two have had a notable positive impact on price, and even those occurred during Bitcoin bull markets,” Thielen said.
“The three major Ethereum catalysts of 2024 have largely fallen flat, adding little value overall,” he added.
Ether is trading at $3,351 at the time of publication. Source: CoinMarketCap
Thielen says that Ether could continue to underperform against Bitcoin in 2025, too, though other crypto analysts say Ether’s price remains uncertain and could move in either direction.
Pseudonymous crypto trader Cold Blooded Schiller said in a Dec. 31 X post that Ether has been “rangebound” since Dec. 25, and either two scenarios are likely to play out.
On the optimistic side, they suggested Ether might stage a “sweep and run” to the upside, triggering a price breakout. Conversely, it could break down to the Dec. 20 range low, potentially retesting the $3,000 level.
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Echoing a similar sentiment, pseudonymous crypto trader Dal believes Ether could go in one of two directions.
“Compressing hard, I think if we flip 3,554 and we go back to 4k if we can’t flip, I think we can sweep 3,102,” Dal said in a Dec. 31 X post.
MN Capital founder Michael van de Poppe is more bullish on Ether and believes it is showing signs of breaking out relative to Bitcoin in January 2025.
In a Dec. 24 X post, Van de Poppe said that he “wouldn’t be surprised if $ETH / $BTC breaks through 0.04 in January.”
At the time of publication, the ETH/BTC ratio — a metric showing Ether’s relative strength to Bitcoin — is 0.03571, according to TradingView data.
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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.
