Introduction:
Ether (ETH) exchange-traded funds (ETFs) have been on a roll, posting net inflows for 22 of the last 24 trading days in 2024. This consistent momentum has sparked optimism among analysts, with some predicting even greater growth next year, especially if the anticipated Trump administration adopts crypto-friendly policies.
History Suggests a Promising Start to 2025
Looking back, Ether has historically performed well in the first quarter of years following a U.S. election and Bitcoin halving cycle. For instance, Q1 2017 and Q1 2021 saw Ether soar by 518% and 161%, respectively, according to data from Coinglass. These impressive returns even surpassed Bitcoin’s gains during the same periods, which came in at 11.9% and 103.2%.
This optimism for Q1 2025 is further fueled by the strong inflows into spot Ether ETFs, which have already amassed over $2.5 billion. Some enthusiasts even project that these funds could attract over $50 billion in net inflows next year, potentially becoming a key driver of market growth.
Analysts Split on What 2025 Could Bring
Not everyone is on the same page about Ether’s future. CK Zheng, the chief investment officer at ZX Squared Capital, is particularly bullish. He expects a massive uptick in ETF inflows, citing potential regulatory clarity from the Trump administration as a catalyst.
“We’re looking at a significant boost in inflows as the administration introduces policies that could legitimize digital assets further,” Zheng told Cointelegraph.
However, Markus Thielen, founder of 10x Research, strikes a more cautious tone. He warns that a “hawkish” macroeconomic environment could limit Ether’s growth in 2025.
“We anticipate a slower year ahead, with tighter monetary policies and reduced liquidity acting as headwinds,” Thielen explained.
Macroeconomic Challenges Ahead
The Federal Reserve’s recent policy shifts are adding complexity to the outlook. In December, the Federal Open Market Committee scaled back its expected 2025 interest rate cuts, dropping the number from five to just two. This adjustment could see the federal funds rate settle around 3.9%, higher than the previously projected 3.4%.
The crypto market has already felt the impact, pulling back by 12.1% to a $3.41 trillion market cap. While these macro pressures weigh on the sector, some analysts still hold a cautiously optimistic view. Thielen believes Bitcoin could potentially reach $160,000 in a best-case scenario, though he predicts it’s more likely to stabilize around $125,000.
Where Things Stand Now
Currently, Bitcoin is trading at $93,492, while Ether is priced at $3,997, marking a modest 0.6% gain in the last 24 hours. Despite this uptick, Ether remains 30.3% below its all-time high of $4,878, set in November 2021.
As we head into 2025, the crypto market stands at a crossroads. Will regulatory clarity and historical trends propel Ether to new heights, or will macroeconomic headwinds keep it grounded? The coming months will reveal whether Ether can once again shine as a market leader.
1 thought on “Ether ETFs See Consistent Growth as Analysts Eye 2025 Trends”