According to a recent report by Steno Research, Ethereum (ETH) is poised to outperform Bitcoin (BTC) in 2025. This outlook is attributed to historical trends and the anticipated impact of favorable cryptocurrency regulations following Republican presidential candidate Donald Trump’s victory in the November election.

Will 2025 Be The Year Of Ethereum?

While the overall cryptocurrency market surged to unprecedented heights this year – reaching an all-time high (ATH) total market cap of $3.9 trillion – Ethereum, the second-largest cryptocurrency, has lagged behind in terms of price performance.

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However, Steno Research’s report suggests Ethereum could finally achieve a new ATH in 2025, driven by increased institutional investment and supportive regulatory developments. The report predicts that ETH could climb to at least $8,000 in the upcoming year.

Bitcoin is also expected to hit a new ATH of $150,000 in 2025, but Ethereum may more than double from its current price of $3,400. Additionally, the ETH/BTC trading pair is forecasted to rise from 0.035 to 0.06 within the next 12 months.

The weekly chart below illustrates ETH’s declining performance against BTC since September 2022. However, the pair is now hovering near a crucial support level at 0.035, with expectations of a rebound to the 0.06 level, which was last seen in February 2024.

Steno Research’s optimistic forecast for Ethereum underscores a potential bullish momentum for altcoins in 2025. Mads Eberhardt, an analyst at Steno Research, stated:

This expectation is partly based on the argument that Donald Trump’s U.S. presidential victory is more favorable for altcoins than for Bitcoin.

The report adds that Bitcoin dominance (BTC.D) – a metric used to gauge the proportion of the total crypto market cap commanded by BTC – is expected to tumble to as low as 45% from its current level. 

The following weekly chart demonstrates BTC.D’s sustained uptrend since September 2022, rising from a low of around 39% to a peak of 61%. However, recent price action suggests a lower high has been formed, signaling a potential sharp decline to around 45%.

DeFi Activity To Rebound In 2025

The report further predicts a resurgence in decentralized finance (DeFi) activity within Ethereum’s ecosystem in 2025. Specifically, the total value locked (TVL) in decentralized applications is expected to hit a new high of $300 billion next year.

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Renewed interest in DeFi could further drive higher altcoin prices in 2025. Notably, ETH jumped 10% following Trump’s November election victory, as improved sentiment surrounding DeFi regulations boosted market confidence.

In addition, strong inflows attracted by spot Ethereum exchange-traded funds (ETF) further strengthen the bullish case for ETH heading into 2025. At press time, ETH trades at $3,417, up 3% in the past 24 hours.

Featured image from Unsplash, charts from Tradingview.com

A widely followed crypto analyst believes Bitcoin’s (BTC) delay in entering the most explosive phase of the cycle comes with pluses and minuses.

Pseudonymous analyst Dave the Wave tells 147,700 followers on the social media platform X that Bitcoin may remain in a technical bullish trend for a while longer before eventually going parabolic.

“The simple fact is that BTC price has not gone parabolic yet. This is both a negative and a positive. A negative in that those higher prices might not come in the here and now (is this really a negative?), and a positive in that price is still technically stable with eventual higher prices at a later date, compared to if the spike had come sooner.

With the number getting high fast, this served to over-excite the market. There is an element of ‘money illusion’ at work in this in my opinion. Keep in mind also that price can always turn on a dime to the upside despite the sober technicals.”

Dave the Wave uses his version of logarithmic growth curves (LGCs), which aim to forecast Bitcoin’s market cycle highs and lows while filtering out short-term volatility.

Looking at the trader’s chart, he suggests that LGC’s support levels may be tested around the $70,000 range while the overall bullish trend remains intact.

He also says that Bitcoin is currently in a consolidation phase until it can break out of a key trendline.

“BTC consolidation the order of the day until the downward diagonal can be broken. Technically, still very solid.”

Bitcoin is trading for $92,338 at time of writing, down 13.2% in the last two weeks.

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Disclaimer: The analyst who wrote this piece owns shares of MicroStrategy (MSTR)

It’s been a tough month for MicroStrategy (MSTR), the software developer turned bitcoin (BTC) accumulator. Its stock has tumbled almost 50% since November, when it joined the Nasdaq 100 index and peaked at a 600% gain since the start of the year.

That still leaves the Tysons Corner, Virginia-based company a whopping 342% ahead in 2024, the biggest return among the highest-profile crypto-linked assets in traditional finance (TradFi).

It’s been a volatile year, packed with geopolitical and technological developments to rattle financial markets. The continuing wars in eastern Europe and the Middle East, elections across the globe, the unwinding of the yen carry trade in August and the growth of artificial intelligence (AI) have all left their marks.

MicroStrategy’s gain is almost double that of Nvidia (NVDA), the chipmaker whose production of integrated circuits needed for AI applications fueled a 185% return, the best among the so-called magnificent seven tech stocks. The next best, Meta Platforms (META), turned in 71%.

Bitcoin itself rose 100% in a year that included April’s reward halving and multiple record highs. Demand for the largest cryptocurrency was driven by the January approval of spot exchange-traded funds (ETFs) in the U.S. Bitcoin outperformed two of its biggest competitors, ether (ETH), up 42%, and Solana (SOL), up 79%.

Among the ETF’s iShares Bitcoin Trust (IBIT) also returned over 100% and became the fastest ETF in history to hit $50 billion in assets.

Bitcoin mining companies, on the whole, disappointed. Valkyrie Bitcoin Miners ETF (WGMI), a proxy for mining stocks, rose just under 30%. That’s despite demand for the miners’ computing capabilities and power supply agreements from artificial intelligence and high-performance computing (HPC) companies. Still, individual companies benefited, in particular, Bitdeer (BTDR),which added 151%, and WULF (WULF), which gained 131%.

Nevertheless, the miners’ gains beat the broader equities market. The tech-heavy Nasdaq 100 Index (NDX) added 28% while the S&P 500 Index (SPX) rose 25%. The S&P 500 also trailed behind gold’s 27% increase. The precious commodity has now topped the equity gauge in three of the past five years.

Concerns about U.S. inflation and the country’s budget deficit added to the geopolitical uncertainties to prompt a massive rise in U.S. treasury yields, which move in the opposite direction to price.

The yield on the 10-Year Treasury added 15% to 4.5% over the course of the year, and surprisingly gained a full 100 basis points since the Federal Reserve started cutting interest rates in September.

The iShares 20+ Year Treasury Bond ETF (TLT), which tracks bond prices, dropped 10% this year and has lost 40% in the past five years.

The dollar, on the other hand, showed its strength. The DXY Index (DXY), a measure of the greenback against a basket of the currencies of the U.S.’ biggest trading partners, rose to the highest since September 2022.

West Texas Intermediate (USOIL), the benchmark oil price in the U.S., ends the year little changed, up less than 1% to around $71 a barrel. But it was a bumpy ride, with the price rising to almost $90 at some points in the past 12 months.

As we head into the new year, all eyes will be on the debt ceiling discussion, the policies of President-elect Donald Trump and whether the U.S. can continue with its impressive growth story.