Ethereum Price Forecast: ETH consolidates below $2,000 as Standard Chartered alters its prediction for 2025
Ethereum price today: $1,900
- Standard Chartered analysts led by Geoffrey Kendrick lowered the bank's expectations for Ethereum's price in 2025.
- The bank adjusted its latest prediction, reducing Ethereum's 2025 price target from $10,000 to $4,000.
- Ethereum needs to overcome a key descending trendline resistance to break out of its range-bound movement.
Ethereum (ETH) remained just below $2,000 in the Asian session on Tuesday as Standard Chartered's Global Head of Digital Assets Research, Geoffrey Kendrick, updated the bank's 2025 price forecast for ETH. The UK-based financial institution now expects Ethereum to reach $4,000, a significant revision from its earlier projection of $10,000.
Standard Chartered predicts new Ethereum price potential in 2025
Standard Chartered analysts predicted that Ethereum may not get to $10,000 in 2025 due to the growing impact of Layer-2 solutions on its value.
In a market note to investors, Standard Chartered's Geoffrey Kendrick shared the bank's updated expectations on the price of Ethereum. The revision of this price run comes after Ethereum hit multi-month lows, with its price dropping below the $2,000 threshold.
Standard Chartered now expects Ethereum to rise to $4,000 in 2025 instead of its initial prediction of $10,000.
Kendrick also anticipates Ethereum's prolonged market cap decline until the end of 2027. Although Ethereum could recover and begin performing well again, the analysts noted that its market cap will ultimately continue to lose out in the long run.
The major reason for this decline in the forecast is the effect of Ethereum's Layer-2 networks on its efficiency and price. Kendrick noted that Ethereum has "commoditized itself" as it continues to lose out to Layer-2 solutions on its blockchain. The continual diversion of fees away from Layer-1 onto L2s has caused its price to decline.
Coinbase's Base blockchain became a major reference source for Kendrick when discussing L2s. According to Kendrick, Base alone has siphoned approximately $50 billion from Ethereum's market capitalization.
He explained that when users transact on these Layer-2 solutions rather than the main Ethereum network, transaction fees are redirected to external entities like Coinbase instead of the Ethereum validators. As a result, Ethereum collects fewer fees.
The analyst also suggested that this decline in fee negatively affects ETH's price, as it reduces the Ethereum blockchain's overall economic activity. As transaction fee incomes drop, ETH may need to alter its issuance model to cover operational costs, potentially exerting downward pressure on the asset's value, the bank stated.
Kendrick also proposed that the Ethereum could counter this trend by implementing measures such as imposing fees on Layer-2 networks. However, he expressed skepticism about the likelihood of such a shift in strategy.
"The solution would be to tax Layer 2 super-profits in the same way governments sometimes charge super taxes for foreign-owned mining companies that extract excess profits. Unless that happens, ETH-BTC will keep going down," Kendrick wrote.
Ethereum Price Forecast: ETH extends range-bound move
Ethereum saw $30.21 million in futures liquidations in the past 24 hours, per Coinglass data. The total amount of long and short liquidations accounted for $15.77 million and $14.25 million, respectively.
The top altcoin extended its consolidation into the second week as it failed to recover the $2,000 psychological level and secure a move above a key descending trendline resistance.
ETH/USDT daily chart
If the consolidation persists, ETH could suffer a breakdown below $1,750 to test the critical support level at $1,500. On the upside, ETH needs to overcome the descending trendline resistance and hold it as a support to flip the bearish trend.
The Relative Strength Index (RSI) and Stochastic Oscillators (Stoch) are below their neutral levels, indicating dominant bearish momentum.
A daily candlestick close above $2,200 will invalidate the bearish thesis and potentially send ETH toward $2,800.
Ethereum FAQs
Ethereum is a decentralized open-source blockchain with smart contracts functionality. Its native currency Ether (ETH), is the second-largest cryptocurrency and number one altcoin by market capitalization. The Ethereum network is tailored for building crypto solutions like decentralized finance (DeFi), GameFi, non-fungible tokens (NFTs), decentralized autonomous organizations (DAOs), etc.
Ethereum is a public decentralized blockchain technology, where developers can build and deploy applications that function without the need for a central authority. To make this easier, the network leverages the Solidity programming language and Ethereum virtual machine which helps developers create and launch applications with smart contract functionality.
Smart contracts are publicly verifiable codes that automates agreements between two or more parties. Basically, these codes self-execute encoded actions when predetermined conditions are met.
Staking is a process of earning yield on your idle crypto assets by locking them in a crypto protocol for a specified duration as a means of contributing to its security. Ethereum transitioned from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) consensus mechanism on September 15, 2022, in an event christened “The Merge.” The Merge was a key part of Ethereum's roadmap to achieve high-level scalability, decentralization and security while remaining sustainable. Unlike PoW, which requires the use of expensive hardware, PoS reduces the barrier of entry for validators by leveraging the use of crypto tokens as the core foundation of its consensus process.
Gas is the unit for measuring transaction fees that users pay for conducting transactions on Ethereum. During periods of network congestion, gas can be extremely high, causing validators to prioritize transactions based on their fees.
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