As a seasoned researcher with over two decades of experience in the financial markets, I have witnessed the evolution and transformation of various asset classes, including cryptocurrencies. The recent surge in Ethereum (ETH) has caught my attention, particularly due to its outperformance compared to Bitcoin (BTC) and Solana (SOL).
With Donald Trump’s inauguration in 2025, analysts at the research and brokerage firm Bernstein predict that staking yields could potentially be approved for Ethereum Spot Exchange-traded Funds (ETFs) in the United States. Notably, the upcoming Trump administration is one of the key factors fueling renewed interest in Ethereum.
The total value of the cryptocurrency market is roughly around $3.37 trillion. This figure dropped by 1.54% over the past day, but it’s important to note that since Donald Trump was elected president, its value has significantly increased by approximately 45%.
The cost of Bitcoin (BTC) soared after the latest update, and Ethereum experienced a moderate rise as well. Here’s the breakdown:
Ethereum Outshines Bitcoin and Solana
Over the last month, Ethereum’s price has surged more than both Bitcoin and Solana. Bitcoin and Solana saw increases of 41% and 36% respectively, but Ethereum experienced an even greater jump of 46%.
Ripple-related XRP, currently valued at $2.67, has surpassed Solana’s market capitalization following a 358% surge within the same timeframe. However, Ethereum remains behind in terms of yearly growth.
According to Bernstein analysts, headed by Gautam Chhugani, they’ve outlined a less optimistic viewpoint on Ethereum: it may find it difficult to function as a value-holding asset like Bitcoin, and it encounters stiff competition from other Layer-1 blockchains. Moreover, Ethereum’s dependence on Layer 2 solutions for growth can lead to fractured user experiences.
Over an extended period, these actions tend to encourage retail users to migrate to other blockchains, which are generally perceived as faster. Some of these blockchains might even be specific Layer-2 protocols such as Base. Analysts suggest that by doing so, Ethereum’s ability to expand its transaction fees and maintain its user base may be hindered.
Although Ethereum has been performing poorly, analysts have pointed out that its risk-to-reward ratio is increasingly appealing. This trend could potentially draw more interest towards the cryptocurrency over time.
According to Bernstein analysts’ perspective, they identified four key factors that may drive ETH’s growth during this cycle. One of these factors is the possibility of staking rewards, which was initially excluded from the approval process for U.S. spot Ethereum ETFs. Given the pro-crypto stance of the current U.S. President, this feature could potentially be incorporated into the offering of a spot ETH ETF.
According to the analysts, they anticipate that with a fresh SEC led by Trump 2.0 being crypto-friendly, it’s probable that Ethereum (ETH) staking rewards will get the green light.
Hong Kong Set Out to Approve Staking for Ethereum ETFs
As an analyst, I find it noteworthy that Hong Kong regulatory bodies are contemplating the approval of staking functionalities within spot Ethereum Exchange-Traded Funds (ETFs). This potential development could significantly impact the crypto market landscape in Hong Kong and beyond.
It’s widely held that taking this action could provide them with a significant advantage over competitors worldwide in the cryptocurrency sector, particularly within the U.S. Consequently, American regulators might find it necessary to act quickly and integrate the staking feature to preserve their market leadership.
As a researcher examining the Ethereum landscape, I’ve observed that the potential yield on Ethereum, currently standing at 3%, could potentially surge to an impressive 5%. This significant increase is primarily driven by the growing activities within the blockchain ecosystem. For investors, this translates into attractive returns, while asset managers would stand to gain through enhanced ETF economics due to these developments.
Day by day, there’s a growing trend of investments into Ethereum ETFs, indicating a resurgence of attention towards this investment option.
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2024-12-02 19:00