Ethereum, the world's second-largest blockchain network by market capitalization, is facing a sideways price trend into early 2025.
However, many developers, investors, and analysts still believe in its long-term value. From infrastructure upgrades to token standards and increasing institutional interest, several key developments suggest Ethereum may be well-positioned for sustainable growth.
1. The plan to simplify Ethereum and increase performance by Vitalik Buterin
Ethereum co-founder Vitalik Buterin recently proposed replacing the Ethereum Virtual Machine (EVM) with a new execution environment based on RISC-V, an open-source instruction set architecture. The goal is to make Ethereum's codebase simpler, faster, and easier to maintain while still supporting existing smart contracts.
Buterin believes this could lead to 100 times the efficiency for zero-knowledge proofs, which are key to scalability and privacy. He also stated that the network could become "almost as simple as Bitcoin" within five years, making Ethereum more neutral and reliable as a global base layer.
Although this plan has risks such as breaking backward compatibility and requiring retraining for developers, it signals a serious effort to reduce complexity and improve Ethereum's long-term sustainability.
2. The role of Ethereum in the tokenization of real-world assets
Institutional interest in Ethereum is growing. One example is BlackRock's plan to tokenize $150 billion in U.S. Treasury assets, a move that would bring traditional financial products onto the blockchain. These transactions are expected to occur on-chain, and Ethereum is widely regarded as the network likely to be chosen.
If this happens, it could increase Ethereum's total value locked (TVL) by up to 4 times, from $52 billion to over $200 billion. This would reinforce Ethereum's leading position in decentralized finance (DeFi), where it has far surpassed other networks like Solana.
More importantly, BlackRock's success could create a domino effect, encouraging other institutions to bring their assets onto the blockchain—and possibly onto Ethereum.
3. Ethereum increasingly focuses on interoperability
Ethereum developers are actively working to enhance cross-chain communication. Two new token standards, ERC-7828 and ERC-7930, are being developed to help applications, wallets, and block explorers understand token data more clearly.
ERC-7930 introduces a compact binary format for cross-chain addresses, while ERC-7828 adds a human-readable version. These changes aim to create a unified, simpler user experience across Ethereum-compatible chains. This interoperability is crucial as the blockchain ecosystem becomes more interconnected.
If widely adopted, these standards could minimize user errors, improve wallet compatibility, and help Ethereum remain the dominant base layer for cross-chain applications.
4. On-chain metrics indicate accumulation
Ethereum's Z MVRV score, an important on-chain indicator, has returned to its historical accumulation zone, suggesting ETH may be trading near its cycle bottom. In previous cycles, similar indicators occurred just before prices increased for several months or years, including late 2018, March 2020, and mid-2022.
This does not guarantee that prices will fluctuate in any direction, but it shows that many long-term ETH holders are accumulating ETH at current levels. Such behavior often reflects increasing confidence in the network's future potential, regardless of short-term volatility.
5. Ethereum Layer 2 projects are making significant progress
Ethereum's rollup-based scaling strategy continues to show results. This week, the Layer 2 project Scroll announced that it has become the first zk-rollup to allow users to exit independently without relying on a centralized sequencer.
This milestone brings Scroll closer to complete decentralization and improves user trust. The Ethereum ecosystem now includes several Layer 2 solutions, such as Optimism, Arbitrum, zkSync, and StarkNet. Together, they help make Ethereum more scalable and affordable while maintaining strong security from the Ethereum mainnet.
These developments are part of Ethereum's broader effort to become the platform for all types of digital activities, from finance to identity, gaming, and real-world asset payments.
