The optimism is fueled by the expectation of increased adoption among institutions and favorable regulatory changes under a possible Trump administration. Ethereum will also be expected to perform better than Bitcoin. The ETH/BTC rate could double. Decentralized finance activity (DeFi), too, is expected to increase. Ether ETFs are also gaining in popularity, with BlackRock and Fidelity leading the way. Analysts predict that Ether will outperform Bitcoin ETFs once staking funds become available.
Ethereum and Altcoins to lead in 2025
Steno Research predicts that the crypto market will have a record year in 2025. Bitcoin (BTC), and Ethereum (ETH), are expected to surpass previous highs. Steno Research’s latest research notes predict that Bitcoin could reach a price of $150,000 while Ethereum may surpass $8,000. This is due to favorable macroeconomic conditions, regulatory changes, and a historically high performance after the halving.
The expectations for unprecedented adoption by institutions could make these projections a reality. The US-based Bitcoin ETFs and Ethereum ETFs will receive a net of $28.5 and $48 billion respectively.
Steno Research expects Ethereum to outperform Bitcoin. The ETH/BTC rate is predicted to rise to 0.06 or more, almost twice its current value. The performance of this altcoin is predicted to lead to a wider altcoin market, which will see Bitcoin’s dominant position in the crypto-market capitalization drop from 57% at present to 45%.
Steno attributes part of the shift in this report to Donald Trump’s US Presidential victory. Steno thinks that Trump’s win will lead to more on-chain activities, and benefit altcoins such as Ethereum and Solana. Total value locked (TVL), which is expected to surpass $300 billion, will also be a major factor in the success of decentralized applications. The previous record of $180 Billion in 2021 will be surpassed by this new high.
Data on the DeFo protocol TVL forecast for 2025 ( Steno Research )
Grayscale also shares an optimistic outlook. Recently, the firm expanded its list of top 20 tokens by including several Decentralized Finance (DeFi), which includes projects on Solana. This decision was made because of the US policy climate under Trump. Former president Trump promised to name crypto-friendly regulatory officials and make the US a leader globally in the blockchain sector. Raj Brahmbhatt, CEO of Web3 Settlement Company Zeebu is equally confident and predicts that by 2025 the US will be the crypto capital of the world.
The stock and crypto markets are expected to grow in optimism by 2025
Gallup’s December survey found that two-thirds (67%) of Americans expect the stock market to rise by 2025. This is an improvement over 2023. This poll, which included 100,000 people, reflects the increased optimism following Donald Trump’s election victory.
Only 23% of respondents expect US political co-operation, while 32% anticipate international peace. While still very low, these figures are a vast improvement on the gloomy 2023 predictions for global peace and political harmony.
( Gallup)
These sentiments could have a significant impact on the cryptocurrency market. Data from the past suggests that increased stock market growth is often correlated with an increase in risk taking, which benefits Bitcoin and other digital currencies. Bitcoin’s relationship with the S&P 500 remains volatile but it often tracks its price movement.
Geopolitical instabilities could pose challenges. Bitcoins’ sharp drops during conflicts like the Russia/Ukraine conflict and Iran/Israel tensions proved this. Bitcoin also rallied when US banks were unstable.
Gallup’s study also showed mixed expectations about the economy in 2025. Over half of respondents expected an increase in employment, and a manageable level of inflation. However, many still remain concerned with economic problems, which are largely driven by the growing federal budget deficit, and China’s increasing influence. The partisan divide was also apparent, as Republicans expressed more optimism than Democrats for 2025, which is typical when the presidential party changes.
Crypto market forecasts for 2025 remain generally positive, particularly with the expectation of an increasingly crypto-friendly Trump Administration that could boost Bitcoin’s performance. Some speculated that a Bitcoin strategic reserve would be created under the Trump administration. The Federal Reserve’s decision to cut projected interest rates from 5 to 2 by 2025 could have a negative impact on the stock market as well as risky assets such Bitcoin.
Crypto Industry to Await Regulatory Changes in 2025
The digital asset sector is hoping that a change in leadership will bring better regulations and laws. Under Gary Gensler’s tenure and that of his predecessor Jay Clayton the SEC pursued several actions to enforce US crypto laws, such as high-profile suits against Ripple, Coinbase, and other US crypto companies. Stuart Alderoty is Ripple’s Chief Legal Officer. He recently demanded more clarity in the regulatory environment, stating that tokens are not securities but they can be used as part of a transaction involving a security.
Paul Grewal is Coinbase’s Chief Legal Officer. He also provided some insight into the impact of the US Supreme Court decision in 2024 to reverse the Chevron Doctrine. The ruling calls for courts to use independent judgment and not defer to interpretations by agencies, which could change the way SEC cases that involve digital assets are resolved.
In 2025, several ongoing cases involving the SEC and the Commodity Futures Trading Commission will be resolved. The criminal cases against the former Celsius CEO Alex Mashinsky, and Terraform Labs’ co-founder Do Kwon are among those that will be under scrutiny following the sentences of FTX executives as well as Binance’s former CEO Changpeng Zhao. These cases could be affected by changes in the leadership of key regulatory agencies, such as the SEC or CFTC.
Donald Trump’s leadership proposals, such as appointing Paul Atkins, formerly of the SEC, as SEC Chair and replacing Damian Williams as US Attorney of the Southern District of New York with Jay Clayton, indicate potential shifts towards digital assets in terms of regulatory approaches.
The Ether ETF Market Gains Momentum
In December, the momentum of the crypto markets heading into 2019 was already heating up. This is especially true for Ether ETFs. According to Farside Investors, these exchange-traded fund (ETFs), experienced impressive growth during December. Total net inflows exceeded $2.6 billion.
According to CoinShares, this capped an 8-week streak in which consecutive inflows occurred during November and December. This included a record $2.2 billion for the week ending Nov. 26. Ether ETFs are still behind Bitcoin ETFs which have recorded net inflows of over 35 billion dollars for the year 2024.
BlackRock’s iShares Ethereum Trust, (ETHA), led with net inflows of $3.5 billion for the Ether ETF Market in 2017, followed by Fidelity Ethereum Funds (FETH) at $1.5 billion. Grayscale Ethereum Trust’s (ETHE) $3.6 billion net outflows were offset in part by these gains, as investors flocked to lower-cost options like Grayscale’s Ethereum Mini Trust launched in July and with reduced fees.
Bitcoin ETFs also followed a similar pattern. BlackRock’s iShares Bitcoin Trust attracted approximately $37 billion of net inflows while Grayscale Bitcoin Trust experienced over $20 billion outflows. Analysts believe that Ether-based ETFs will outperform Bitcoin-based ETFs by 2025. This is especially true if Ether price increases and regulators allow ETFs the ability to earn staking returns.
Ether has outperformed Bitcoin on both the spot and derivatives market since November. BTC ETFs saw their biggest-ever net withdrawals on December 19, adding to speculation that Ether may take the lead by 2025. Ether is expected to benefit from the growth in Ethereum’s network, which includes an increase in artificial intelligence agents.
VanEck predicts that Ether could be worth $6,000 in the fourth quarter 2025.
