Ethereum: The Comeback Kid of 2025  

Juan Leon    Senior Investment Strategist

Ethereum stands to benefit from several big trends in 2025. One of the biggest: the $100 trillion market for real-world assets.

Two key stories dominated crypto headlines in 2024: Bitcoin’s meteoric rise, fueled by the launch of bitcoin ETFs and record-breaking inflows, and Solana’s emergence as a retail darling, driven by meme coin speculation.

This left Ethereum—the world’s second-largest crypto asset—largely overlooked. Sure, its 66% year-to-date return is good in an absolute sense, but it pales in comparison to Solana’s 106% and Bitcoin’s 130%.

But something interesting has been happening recently: Over the past 10 days, investors have started warming up to Ethereum again.

You can see this most clearly in spot Ethereum ETFs, which have pulled in a whopping $2 billion in net flows over that time frame. By comparison, the same ETFs experienced net inflows of only $250 million over the preceding four months.

So what’s going on here?   

The realization struck me as I was reviewing Bitwise’s recently published 2025 Predictions. Amidst various price predictions, we called out several “real-world” mega-trends that we think will shape the industry in the year ahead, from the continued rise of stablecoins to the proliferation of AI agents transacting in crypto.

But one of the biggest and most overlooked opportunities centers on tokenization: the process of bringing the massive market for real-world assets (RWAs) onto a blockchain.

And that market today is dominated by Ethereum.

“It’s Not Just a Tomorrow Story”

Tokenization refers to the process of digitizing traditional financial assets, such as Treasury bills or real estate, as tokens that can be exchanged on a blockchain. Tokenization promises to make buying, selling, and settling financial assets faster, cheaper, and more natively digital. Many think it could disrupt the fundamental underpinnings of how financial markets work.

And it’s not just a tomorrow story. Tokenized assets are growing fast right now, with firms like BlackRock, UBS, and others bringing tokenized real-world assets online, across government securities, commodities, real estate, private equity and more. BlackRock, for instance, has a $578 million tokenized Treasury fund, and it’s looking to do more. We think tokenized fund assets will triple next year, with Ethereum as the driving force behind it. 

Why Ethereum?

To adapt an old saying: You don’t get fired for building on Ethereum.

Ethereum is the most battle-tested, secure, and decentralized of the smart-contract platforms. It’s been around since 2015 and has established itself as a leader in decentralized applications, smart contracts, and tokenization. It currently holds a commanding 81% market share in tokenized assets, and its long track record and large, distributed validator network gives asset managers confidence in its security and reliability as they migrate assets on-chain.

And here’s the thing: It’s difficult to overstate just how big the RWA market is. Real-world assets are worth roughly $100 trillion globally. It will take time—perhaps decades—for much of that to move to tokenized rails. But if it does, fees from RWA-linked assets could exceed $100 billion per year. That’s more than 40x Ethereum’s total year-to-date fees of $2.4 billion. With the incoming pro-crypto SEC expected to provide the regulatory clarity needed to accelerate tokenization, investors who stake a claim on Ethereum now may find themselves handsomely rewarded in the period ahead.

That’s just one reason among many why we think 2025 is the year Ethereum gets its groove back.