A prominent UK financial services firm, recognized for its cryptocurrency forecasts, has recently revised its price outlook for various altcoins, including Ethereum. With a robust revenue exceeding $14 billion, the institution provides fresh insights into the potential price movements of Ethereum by 2025.
What Changes Are Made to Ethereum Price Forecast?
Geoffrey Kendrick, the head of cryptocurrency research, has adjusted his projections for Ethereum downward. In a recent report entitled “Ethereum – Midlife Crisis,” he emphasizes the significant impact of layer 2 solutions on the Ethereum ecosystem, noting that the Base network has successfully attracted around $50 billion from the Ethereum main network.
What Are the Implications for Ethereum’s Future?
Kendrick underscores that the ongoing modifications to the Ethereum network could lead to adverse effects. The previous Merge phase has shifted power to layer 2 solutions, enabling “super profits.” These developments, including the upcoming Dencun upgrade, may further intensify this trend.
While Coinbase’s strategy of transferring fees through the Base network aims to enhance its revenue, it inadvertently detracts from Ethereum’s overall value. Currently, layer 2 solutions are resulting in decreased activity and profitability for the main Ethereum network, raising concerns about its long-term viability.
- Kendrick predicts that the ETH target for this year is now set at $4,000, a 60% reduction.
- Ethereum must focus on strengthening its share in the Real-World Asset (RWA) market, where it currently dominates.
- Technical upgrades like Pectra could potentially improve scalability and fee structures.
Despite holding a significant portion of total value locked in DeFi and being a leader in stablecoin and tokenized assets, Ethereum’s dominance is declining. To regain momentum, solutions and strategies are essential for sustaining ETH growth over the coming years.
