Analysts at Standard Chartered have revised their Ethereum price forecast for 2025, reducing it from $10,000 to $4000, reports The Block. The reasons cited include the growing influence of L2 solutions, particularly the Base platform.
According to researcher Geoffrey Kendrick, high activity in the Coinbase-supported ecosystem has contributed to a $50 billion reduction in Ethereum’s market capitalization. He noted that a significant portion of fee revenue is now moving away from the main network layer (L1).
A potential solution would be to tax the “super profits” of the second layer, similar to foreign mining companies. If this does not occur, the ETH to BTC rate will continue to decline, Kendrick believes. However, he doubts the prospects of implementing such an approach.
Kendrick stated that changes made to Ethereum over the past few years, “while perhaps necessary, have damaged its value.” These include the transition to Proof-of-Stake following The Merge, the development of L2 solutions, and the Dencun upgrade. All these improvements, according to Kendrick, have provided more scaling opportunities but diverted economic value from the main layer.
Base, for example, generates profits, part of which goes to Coinbase, the exchange behind the platform’s development. As a result, this creates, according to the analyst, “super profit” for L2 amid declining L1 revenues.
Despite weakened positions, the Ethereum blockchain retains a significant share in DeFi (over 50%) and other segments, including stablecoins (57%) and RWA (80%). Kendrick believes that continued growth in the tokenized asset market, where the network dominates, could revive demand.
Growth drivers could also include new updates, especially Pectra, scheduled for 2025, which will make fees more competitive.
Standard Chartered predicts a further decline in ETH/BTC — to a level of 0.015 by 2027, marking the lowest point since 2017. However, in the long term, Ethereum may begin to appreciate again, reaching $7500 by 2028-2029.
Back in March 13, the ETH/BTC rate fell to 0.0224. The last time such a low value was recorded was in May 2020.