Markus Thielen, head of research at 10x Research, has suggested that Ethereum may not perform well in the 2025 bull market. In a Dec. 30 report, he stated that Ethereum’s returns could be underwhelming compared to Bitcoin, making it a less favorable investment. Thielen pointed to a decline in active validators on the Ethereum network, which dropped by 1% over the past month. This decline raises concerns about a potential rise in unstaking and the lack of substantial demand beyond staking.

Ethereum’s performance in 2024 reflected these challenges. While Bitcoin recorded a 121.4% return for the year, Ethereum achieved just 46.3%, according to CoinMarketCap. The launch of spot Bitcoin ETFs in January 2024 attracted $35.3 billion in inflows, driving Bitcoin to new highs. In contrast, Ethereum ETFs launched in July saw only $2.66 billion in inflows, fueling a more bearish outlook for the asset.

Thielen also criticized Ethereum’s recent network upgrades. The Duncan upgrade in March, which aimed to reduce gas fees and increase transaction capacity, came too late to capitalize on the meme coin rally, allowing competing platforms like Solana to gain an advantage. Thielen expressed skepticism about the upcoming Pectra upgrade in 2025, stating that out of Ethereum’s 19 past upgrades, only two had a notable positive impact on price, and both occurred during Bitcoin bull runs.

Despite these concerns, some experts see potential for Ethereum. Tim Lowe, chief business officer at Attestant, argued that better marketing and a unified value proposition could boost demand for Ethereum. He noted that diversification from Bitcoin could act as a catalyst for attracting investors to Ethereum.

Opinions among traders also vary. Pseudonymous trader Cold Blooded Schiller suggested two possible scenarios for Ethereum: a breakout following a “sweep and run” to the upside, or a decline toward the $3,000 range. Similarly, trader Dal predicted either a rise past $3,554 toward $4,000 or a drop to $3,102.

Michael van de Poppe, founder of MN Capital, offered a more optimistic view, suggesting that Ethereum could gain strength relative to Bitcoin. He predicted the ETH/BTC ratio might surpass 0.04 in January 2025. As of writing, the ratio stands at 0.03549, according to CoinMarketCap data.

Thielen remains firm in his view that Ethereum is a poor medium-term investment, advising investors to avoid it. Currently, Ethereum is trading at $3,351, with its future performance dividing analysts and traders.

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