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Ethereum (Ethereum) is poised for a rebound in 2025 as it rides a wave of emerging trends to capitalize on the $100 trillion opportunity in tokenized real-world assets (RWAs), according to letter Shared with investors by Bitwise Chief Investment Strategist, Juan Leon.
The document highlighted that the cryptocurrency market was characterized by two narratives this year: Bitcoin (Bitcoin) New all-time high, driven by US exchange-traded fund (ETF) approval, Solana decision (Sol) meteoric popularity as retail investors piled into memecoin speculation.
As a result, Ethereum’s 66% year-to-date return has diminished compared to Bitcoin’s 130% gain and SOL’s 106% rise.
ETFs indicate changes
However, recent signs point to a reversal of emotions. Over the past 10 days, Ethereum ETFs have attracted a staggering $2 billion in inflows, eight times the net inflows of $250 million recorded in the previous four months.
On December 5, Data from Persian investors He noted that US Ethereum ETFs recorded inflows of $428.5 million, a new daily record driven by $292.7 million directed at BlackRock. ETHA.
Furthermore, Ethereum ETFs saw daily inflows below triple digits on only 3 trading days out of the previous 10 trading days that saw inflows.
This rise indicates that institutional and retail investors are warming up to Ethereum again.
RWA growth
Real-world asset tokenization may fuel Ethereum’s resurgence. This process involves digitizing traditional assets – such as Treasuries, real estate and commodities – into blockchain-based tokens, providing faster, cheaper and more efficient trading and settlement.
Coding is no longer a distant dream. Top players love Black Rock, Franklin Templetonand UBS adopted blockchain technology to tokenize RWAs. BlackRock’s tokenized treasury fund, BUIDL, currently has a market capitalization of $544 million.
According to the letter, real assets are estimated to be worth $100 trillion globally, creating an amazing opportunity. While it may take decades for significant portions of this market to shift to blockchain paths, Leon sees huge upside potential.
Given that Ethereum holds 81% of the RWA market, Leon estimates that fees generated by RWA-related activity on Ethereum could eventually exceed $100 billion annually, more than 40 times the network’s $2.4 billion fees year to date.
The letter attributes Ethereum’s dominance to its position as the most trusted and decentralized smart contract platform, believing in its long history of supporting decentralized applications and its extensive distributed verification network.
While the world’s largest asset managers explore token assets, Ethereum remains the “battle-tested” standard. Furthermore, regulatory winds could accelerate this shift, putting Ethereum in a potentially explosive growth trend.
The letter noted that the increasingly pro-cryptocurrency US Securities and Exchange Commission (SEC) may provide much-needed clarity and remove barriers to adoption and institutional participation.
