Standard Chartered Bank has lowered its price target for Ethereum (ETH) from $10,000 to $4,000 for the end of 2025 as reported by Watcher Guru. This adjustments arise from the concerns that have been raised over structural recession within Ethereum ecosystem, as highlighted in their latest research report.
One of the primary factors contributing to this pessimistic outlook is the rise of Layer 2 (L2) solutions, such as Coinbase’s Base. Originally designed to enhance Ethereum’s scalability and transaction efficiency, these L2 solutions have in fact weakened ETH’s market value, leading to evaporation of approximately $50 billion.
Analysts at Standard Chartered warn that this trend could continue to undermine Ethereum’s market dominance, as more users and developers gravitate towards these alternative solutions.
Moreover, the report predicts a decline in the ETH/BTC ratio, forecasting it to fall to 0.015 by the end of 2027. This would mark its lowest level since 2017 and indicates that ETH is likely to not perform well when compared to Bitcoin in the coming years.
Real-World Assets Tokenization: A Ray of Hope
Despite these challenges, there remains a ray of hope for ETH. The bank notes that if the tokenization of real-world assets (RWA) gains significant traction, ETH could potentially maintain its substantial 80% share in security markets.
However, this would require the Ethereum Foundation to adopt more aggressive business strategies, such as imposing taxes on L2 solutions, a possibility deemed unlikely by analysts.
Ethereum’s Long-Term Outlook Remains Uncertain
Currently the price of the ETH token stands at $1,917.01 with an uptick of 0.1% in the last 24 hours as per CoinGecko. Standard Chartered anticipates that a bullish Bitcoin market could drive a short term rebound for ETH. However, they caution that ETH’s long-term prospects may continue to lag behind its competitors in the evolving cryptocurrency landscape.
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