Gautam Chhugani highlights the usefulness of ETH in the dApp ecosystem.
Much of the ETH issued is staking, says the analyst.
Analysts at research and brokerage firm Bernstein predict that Ethereum’s cryptocurrency ether (ETH) will have a breakout year in 2025.
Gautam Chhugani, who leads the analysis, assures that ETH could establish itself as the next “institutional favorite”.
Even though ETH has had a moderate performance in the last year, with an increase of 56% and far from its all-time high of $4,800 reached in 2021Bernstein points out that its usefulness in the ecosystem of decentralized applications (dApps) and Their role in staking reinforces their position in the market.
The firm highlights that 28% of ether issued is deposited in staking. This practice, which allows users to earn rewards by locking their tokens in smart contracts, reduces the availability of ETH in the market, as defined by Criptopedia, the educational section of CriptoNoticias.
In addition, 3% of ETH is absorbed by ETFs and 7.5% remains locked in smart contracts.
According to Bernstein, this limited supply, combined with its usefulness as a fee payment and collateral asset in layer 1 and layer 2 chains, attracts traditional investors.
These factors, analysts explain, offer intrinsic value that is attractive to institutions looking for digital assets with clear applications.
The “age of infinity” and institutional advance
Bernstein defines this period that begins in 2025 as the “age of infinity”, in which cryptocurrencies cease to be controversial and become fully integrated into global financial systems.
According to Chhugani, investors can expect lower volatility in boom and bust patterns as cryptocurrencies are positioned as a structural part of the financial landscape.
He also points out that Companies, banks and financial institutions are integrating digital assets into their operationsconsolidating its adoption.
Stablecoins and regulation
Analysts also foresee a favorable regulatory environment for cryptocurrencies in 2025. With the new administration in the United States, led by Donald Trump, Bernstein anticipates progress in legislation on stablecoins.
These types of assets, which strengthen the US dollar through the purchase of Treasury bonds and the distribution of digital dollars, could benefit from greater legal clarity and new regulatory licensesensures the analysis.
Cryptocurrencies and artificial intelligence
Additionally, Bernstein hopes that the convergence between cryptocurrencies and Artificial Intelligence (AI) will drive new innovations.
Key developments include decentralized networks focused on computing and inference, authentication services based on “proof of human being,” and wallets with AI capabilities.
ETH, backed by its network and utility, could consolidate its position in 2025 as a key asset for financial institutions. With an evolving regulatory environment and its integration with new technologies such as AI, ETH appears well positioned to capture the interest of traditional and emerging markets.
Although, taking bitcoin’s place as an “institutional favorite” seems to be something quite difficult to achieve.
