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.

Related Reading

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.

Related Reading

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

Tema may garner attention on social media with over 2.7 million TikTok fans tuning in to watch the beloved raccoon, but as a meme coin, it’s trending for the wrong reasons.

Tema (TEMA), at last check Sunday, was down about 24% and trading at $0.04046. It currently has a market cap of $40.5 million, a circulating supply of more than 999.9 million and a 24-hour trading volume of around $7.87 million.

The meme coin — launched on the Solana blockchain — is inspired by a raccoon named Tema, which has over 2.7 million followers on TikTok.

AI Companions rallies

AI Companions (AIC) is a cryptocurrency token that powers a platform offering customizable, interactive virtual partners.

These companions utilize AI, virtual reality, augmented reality, and blockchain technologies to provide immersive digital companionship experiences.

Its current price is approximately $0.1139 per AIC with a market capitalization of around $84 million.

• Circulating Supply: 750 million AIC tokens, with a maximum supply of 1 billion tokens.
• Recent Performance: The token has experienced significant price fluctuations, with a notable increase of over 52% in the last 24 hours.
• Monetization Strategies: AI Companions employs various monetization methods, including free access with limited features, staking AIC tokens, and subscription models.

AIC tokens are available for trading on several centralized exchanges, including Gate.io, MEXC, and BingX, with the AIC/USDT pair being the most active.

Meme coins ranked among the most popular crypto narratives of 2024, creating a divide between crypto tokens. Bitcoin stands out among top crypto tokens with 125% year-to-date gains, and the meme coin category, or the “other tokens”, hit a key milestone, crossing a market capitalization of $100 billion. 

Dogecoin (DOGE), Shiba Inu (SHIB) and Pepe (PEPE), the top three meme coins, have erased between 11% and 13% of their value in the past week. Bitcoin consolidates close to $95,000, nearly 12% below its all-time high of $108,353. 

Bitcoin vs meme coins, most popular narrative of 2024

Meme coins captured the attention of most crypto traders and emerged as a popular narrative this year. A CoinGecko report updated on Monday notes that the meme coin narrative captured a combined 30.67% of global investor interest. 

The report highlights that almost a third of crypto narrative interest this year was focused on speculative gains from meme coins. Traders placed a lower emphasis on fundamentals and turned their attention and capital towards dog and cat-related meme coins, pop culture references and internet personality-themed meme tokens.

Meme coins have enjoyed a 6% year-on-year increase in interest from crypto market participants. While Bitcoin garnered institutional attention and capital allocation following the approval of Spot BTC ETFs in the US, four meme coin-based trends ranked among the top 20 narratives in crypto. 

Solana (SOL), Base, Artificial intelligence and cat-themed meme coins garnered between 14% and 8% of interest among crypto narratives. 

With meme coins cementing their place as a trending token category and trending this cycle, catalysts like institutional allocation and ETF approval could pave the way for further gains for holders. 

Base, Solana, XRP memes dominate over blue-chip memes in speculative gains 

In the first week of December, XRP-based meme coins yielded gains for holders amidst rising relevance and demand for the XRP Ledger and its native token XRP. Similarly, Solana and Base-based meme coins have secured a rank in the top 20 cryptocurrency narratives of the year, dominating the popularity of blue-chip meme coins. 

Dogecoin, SHIB and PEPE are typically considered blue-chip memes, with a market capitalization between $7 and $46 billion, as seen on CoinGecko. The top 3 tokens in the meme coin category observed a spike in active addresses and activity from traders within the first two weeks of December. 

In the last seven days, the top 3 tokens have erased double-digit value, according to CoinGecko data. Several other meme tokens have accumulated double-digit losses, barring Pudgy Penguins (PENGU). 

Institutional meme coin holdings tripled this year 

The wave of meme coin adoption drove institutions to tripe their holdings in the category. From February to March 2024, institutional investors’ spot holdings of memecoins climbed from $62.5 million to $204.8 million. 

This marks a 226% surge, a significant spike in interest in the memecoin market, according to Bybit’s report on institutional investment in meme coins.

In the Bybit report, Eugene Cheung, Head of Institutions of Bybit, is quoted as saying:

“Our report ‘Beyond the Hype’ shows that institutional and retail investors are actively leveraging the opportunities presented by the memecoin market. The strategic agility of institutions and the dynamic management by retail investors reflect a sophisticated engagement with these assets. We invite everyone to delve into the full report to understand these important dynamics better.”

Dogecoin ETF likely in 2025?

Rising institutional adoption has raised questions about the likelihood of approval from the U.S. financial regulator, the Securities and Exchange Commission, for meme coin ETFs. Nate Geraci, President of ETFStore expressed shock that an issuer has yet to file for a Dogecoin ETF, both in and outside of the U.S.

Geraci believes the only possible downside of such a filing would be that it would mark a futile attempt and end up as a marketing expense for an issuer. The President of the ETFStore commented on the “DOGE” ticker since it is the ticker for the largest meme coin and would likely hold the highest relevance and demand among issuers in the future, 

As the SEC greenlights the Bitcoin-Ethereum hybrid ETF, DOGE traders have hopes for a Dogecoin ETF approval in 2025. 

Bitcoin and meme coin divide runs deep

Ruslan Lienkha, Chief of markets at YouHodler told Crypto.news in an exclusive interview:

“Dogecoin’s recent performance appears primarily speculative, driven by its association with Elon Musk, rather than any underlying fundamentals, as it still lacks substantial real-world use cases. However, a potential utility could develop in the future.”

Lienkha comments on what divides Dogecoin and similar meme coins from Bitcoin. While Bitcoin has gained acceptance as “digital gold” and hedge against the devaluation of a fiat currency, Dogecoin and the like are considered speculative tokens. 

The Bitcoin and meme coin divide runs deep and could influence the approval of a meme coin ETF, further investment from institutional investors and retail participation in the category in the second leg of the bull market. 

Typically, a drawdown in Bitcoin ushers a steeper and market-wide correction, wiping recent gains from meme coins and hitting the market capitalization of the category negatively. The correlation with Bitcoin could continue to drag down meme coins, and in every instance, the largest crypto crashes or reacts to a market-moving event during this cycle.