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Analyst Warns of Lacklustre Year for Ethereum Despite Stellar Month for ETFs
- Ethereum’s 2024 performance lagged significantly behind its competitors, with a 42% gain trailing Bitcoin’s 114%, XRP’s 267%, and Solana’s 77% increases despite receiving ETF approval.
- Markus Thielen, head of research at 10x Research, advises investors to avoid ETH in 2025, citing poor medium-term prospects and predicting continued underperformance against Bitcoin.
- Despite recent positive momentum with ETH ETFs gaining over US$2.08 billion in December inflows, Thielen criticises network upgrades as superficial and warns of increasing competition in the space.
2024 wasn’t exactly Ethereum’s year. Yes, like Bitcoin, ETH saw the approval of the much-anticipated US Spot exchange-traded funds (ETFs); however, unlike BTC, it missed out a little on the price rally.
While the largest crypto gained 114% year-on-year, the second in charge, ETH, managed only 42%. Although that doesn’t sound too shabby at first glance, when you look closer and compare this to its competitors like XRP, which gained 267%, or Solana which still managed 77%, ETH’s performance is much less impressive.
Related: MicroStrategy Shares Fall Following Latest Bitcoin Purchase
And as you can see in the chart below, ETH’s price fluctuated significantly throughout the year.
Possible Rough Patch Ahead for ETH in 2025, Says Analyst
And if that wasn’t enough, an analyst’s recent prediction could leave Ethereum holders more sour than a pickle in a lemon juice bath.
Head of research at 10x Research, Markus Thielen, believes Ethereum may not be the best bet for the 2025 bull run.
Thielen wrote in a note to investors on December 31, 2024, that despite the “possibility of a new catalyst […] we wouldn’t be surprised if Ethereum struggles to deliver meaningful rallies next year”.
The analyst thinks there’s ample competition for Ethereum which could continue to outperform it and therefore doesn’t recommend holding ETH:
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. As a result, our stance on Ethereum remains clear: ‘avoid’.
Markus Thielen,10x Research Despite Recent Inflows, BTC ETFs Still Outshine ETH ETFs
Thielen also criticised the upgrades to Ethereum, like Dencun and others planned for 2025, as superficial, adding little to the network. He also highlighted the underperformance of the ETH ETFs compared to the Bitcoin ETFs.
The launch of Ethereum ETFs in July delivered underwhelming inflows. [Which] is telling, especially for an asset typically regarded as higher beta.
Markus Thielen,10x Research Despite this, the Ether ETFs have started picking up pace over the past few weeks.
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In December, these ETFs saw net inflows exceeding US$2.08 billion (AU$3.35 billion), outpacing Bitcoin ETFs, with a significant US$428.5 million (AU$690.8 million) on a single day alone on December 5, marking several weeks of consecutive inflows, as per data from Farside Investors and Coinglass.
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
