Ether’s 2025 Struggles, but Fundamentals and TVL Show Improvement: Citi Report
Ether (ETH) has experienced a decline of over 20% this year, but its underlying fundamentals are showing signs of improvement, according to a report released by Wall Street bank Citi on Monday.
Despite the underperformance, analysts led by Alex Saunders believe the outlook for Ether isn’t as bleak as it seems. They pointed out that while user activity has fluctuated recently, the broader fundamental picture remains relatively positive.
A key indicator of this improvement is the rise in Total Value Locked (TVL) on the Ethereum blockchain, which has seen significant growth. Additionally, Ether exchange-traded funds (ETFs) continue to attract inflows, and search interest around the cryptocurrency is trending upward.
Since the U.S. election in November, Ether ETF flows have turned positive, accumulating $3.2 billion in total since their launch in July. This suggests ongoing investor confidence in Ether despite its price struggles.
However, Citi’s report also raised concerns about Ethereum’s competitive edge, noting stronger user growth on layer-2 solutions and rival blockchains such as Solana, which could potentially challenge Ethereum’s dominance.
The report also highlighted the significant holdings in Ether by entities like President Trump’s World Liberty Financial, with over $200 million in assets. This could serve as additional motivation for the U.S. to bolster its crypto industry support, Citi suggested.
In terms of market sentiment, the bank noted that Ether’s recent weakness aligns with an increase in Bitcoin (BTC) dominance, which has surged to multi-year highs above 60%. The relative performance of Ether and altcoins may serve as an important gauge for the market’s confidence in potential regulatory clarity for cryptocurrencies in the U.S.
