StanChart Cuts Ethereum 2025 Forecast to $4K
The Most Important Points at a Glance
Standard Chartered (StanChart) has drastically lowered its Ethereum (ETH) price forecast for 2025 – from $10,000 to $4,000. The main reason is the growing dominance of Layer-2 solutions like Coinbase’s Base, which are taking significant market share away from Ethereum. Analysts see this as a threat to ETH’s long-term value performance.
Why Was the Ethereum Forecast Lowered?
According to Geoffrey Kendrick, Head of Digital Assets Research at StanChart, the Layer-2 solution Base has removed around $50 billion from Ethereum’s market capitalization. Layer-2 networks enable faster and cheaper transactions by bundling transactions off the Ethereum blockchain. As a result, Ethereum misses out on significant revenue from transaction fees.
Kendrick suggests that Ethereum should impose a “super tax” on Layer-2 networks to compensate for lost revenue. Otherwise, the ETH/BTC ratio could continue to decline, weakening Ethereum in comparison to Bitcoin.
Market Reactions and ETH Price Development
Ethereum has lost value against Bitcoin in recent years. The ETH/BTC ratio reached a five-year low of 0.22 – a 73% decline since 2022. Compared to the S&P 500 Index, Ethereum has also underperformed since 2018.
After rising 167% between late 2023 and early 2024, the ETH price recently fell to $1,900. If the downward trend continues, further price losses to $1,600 or even $1,200 could follow.
Criticism of the StanChart Forecast
Not all analysts share StanChart’s pessimistic outlook. Ceteris, Head of Research at Delphi Research, considers the $4,000 forecast to be overly optimistic and points to StanChart’s often unrealistic predictions.
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Anatoly Yakavenko, co-founder of Solana, sees Ethereum’s situation as critical but does not believe a similar scenario would push Solana into the single-digit range.
Our Assessment
The growing importance of Layer-2 solutions presents challenges for Ethereum. While these networks improve scalability, they also reduce Ethereum’s revenue. Whether a “super tax” on Layer-2 networks would be a viable solution remains questionable.
In the short term, Ethereum could remain under pressure, especially if the downward trend in the ETH/BTC ratio continues. In the long term, Ethereum’s development will depend on how the network handles competition from Layer-2 solutions and whether it finds new ways to maintain its value for users and investors.
| Symbol | ETH |
| Coin type | Alt Coin |
| Transaction Speed | Medium |
| Pros |
|
| Cons |
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| Further practical applications | |
| Price | $1,903.13 |
| 24h % | -1.79 % |
| 7d % | -2.32 % |
| 30d % | -29.10 % |
| 60d % | -44.56 % |
| 1y % | -45.34 % |
| Market Cap | $229,563,449,009.00 |
| Official Links | Website | Source Code |
| Socials | Reddit | X |
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