From cointelegraph by Ciaran Lyons

Markus Thielen, 10x Research’s head of research, said Ether might not be the wisest investment choice for a 2025 bull run, as the asset may deliver underwhelming returns compared with Bitcoin. 

Other analysts said they are waiting for more confirmation from the price charts 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,” 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 said one of the most important metrics to watch in 2025 will be the trend in active validators. Still, he noted that the growth rate of validators had turned negative, dropping by about 1% over the past 30 days, raising concerns about the increasing risk of more validators exiting the network.

Thielen said a rise in unstaking seems “logical,” arguing that Ethereum lacks “real demand” outside of staking.

Others may not agree 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 would 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$95,884 is up 121.4% since Jan. 1, 2024, Ether clocked a 46.3% return over the same period, according to CoinMarketCap data.

On Jan. 11, 2024, spot Bitcoin exchange-traded funds (ETF) launched in the United States and were met with strong demand that helped push Bitcoin’s price to new highs within two months. When US Ether ETFs launched in July, the demand was significantly less, leading to a more bearish view of the asset.

Bitcoin ETFs saw $35.3 billion in inflows across the year, while Ether ETFs reached $2.66 billion.

Thielen said the Duncan upgrade in March — which reduced the network’s gas fees and allowed it to handle more transactions — “arrived six months too late.” It missed the peak of the memecoin rally, and the market shifted to the “more cost-effective” Solana SOL$206.01 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.

Thielen said that Ether may continue to underperform against Bitcoin in 2025 as well, 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 one of two scenarios is likely to play out:

On the optimistic side, Ether might stage a “sweep and run” to the upside, triggering a price breakout. Or it could break down to the Dec. 20 range low, potentially retesting the $3,000 level.

Related: Bitcoin price ‘stuck in a void between liquidity’ on NYE — Will 2025 open bring the volume?​​

Echoing a similar scenario, pseudonymous crypto trader Dal said 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 said 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 — was 0.03571, according to TradingView data.