📢 Standard Chartered Lowers Its Ethereum Target for 2025 from $10,000 to $4,000: Here’s Why
In January, the leading global bank forecasted Ethereum to reach $10,000 by the end of this year, with Bitcoin (BTC) potentially hitting $200,000. In a recent report, the bank slashed the Ethereum estimate to $4,000, representing a 60% drop.
This revision comes as ETH has underperformed massively amid the ongoing market downturn compared to other top altcoins. For instance, the asset is down by more than 42% year-to-date, making it one of the biggest losers this year.
However, Standard Chartered‘s revised estimate is largely due to the growing dominance of Layer-2 solutions, particularly Base, which the bank argues is extracting substantial value from Ethereum without reinvesting proportionally.
Standard Chartered: L2s Like Base Causing Financial Strain on Ethereum
The bank’s latest research calls attention to the financial strain Ethereum faces as Layer-2 networks capture an increasing share of transaction fees while contributing little to Ethereum’s core ecosystem.
Among these networks, the bank has identified Base, developed by Coinbase, as a major factor in Ethereum’s declining market capitalization. The study estimates that Base alone has redirected around $50 billion in value away from Ethereum by retaining a significant portion of its fee revenue.
Standard Chartered pointed out that Ethereum’s own network upgrades, including the move to proof-of-stake in 2022 and the more recent Dencun update in 2024, have inadvertently fueled this trend.
These improvements, while designed to enhance scalability and reduce transaction fees, have also allowed Layer-2 solutions to flourish at Ethereum’s expense.
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