In 2025, Ethereum won, but ETH failed to keep up.

Original author: Prathik Desai

Original translation by Chopper, Foresight News

As a staunchly bullish ETH investor, I've developed a frustrating habit this year. Every day, I open the ETH price chart and silently calculate how much my portfolio has lost. After calculating, I close the chart, hoping it won't be long before I turn a profit.

As the year draws to a close, most investors who bought ETH at the beginning of the year are probably feeling disappointed. However, despite ETH's lackluster price performance and wealth appreciation over the past 12 months, the Ethereum blockchain has stood out among its competitors.

If "making money" is the benchmark, 2025 was undoubtedly a terrible year. However, looking beyond token returns, holding ETH became more convenient in 2025, mainly thanks to the rise of market-based tools such as ETFs and Crypto Enterprise Treasury (DAT). Furthermore, Ethereum's two major upgrades during the year, Pectra and Fusaka, allowed the public chain to more easily and efficiently support the operation of large-scale applications.

In this article, I will reveal why the development trajectories of the Ethereum network and the ETH token will diverge in 2025, and what implications this has for their future.

Ethereum has finally made its way into the mainstream.

For most of the past two years, "institutional-grade ETH investment" has seemed like an unattainable dream for many. As of June 30, the ETH ETF had seen a cumulative inflow of just over $4 billion since its launch a year ago. At that time, publicly traded companies were just beginning to consider including ETH in their corporate treasuries.

A turning point quietly emerged in the second half of this year.

Between June 1 and September 30, 2025, the cumulative inflow of funds into the ETH ETF increased nearly fivefold, exceeding the $10 billion mark.

This ETF frenzy has not only brought an influx of capital but also triggered a shift in market psychology. It has significantly lowered the barrier for ordinary investors to buy ETH, expanding ETH's audience from blockchain developers and traders to a third group—ordinary investors who want to allocate assets to this second-largest cryptocurrency asset in the world.

This brings us to another major industry transformation that has emerged this year.

Ethereum welcomes a new buyer

Over the past five years, influenced by the investment strategy proposed by the CEO of Strategy, corporate treasuries for Bitcoin have seemingly become the sole paradigm for including cryptocurrency assets on their balance sheets. Before the flaws in this model were exposed, it was once considered the simplest path for companies to allocate cryptocurrency assets: listed companies would purchase scarce cryptocurrency assets, drive up the price of the cryptocurrency, and thus boost the company's stock price; subsequently, the company could use this to issue more shares at a premium and raise more funds.

This is why many were puzzled when the ETH Corporate Treasury became a hot topic in the industry in June of this year. The core reason for the ETH Corporate Treasury's meteoric rise lies in its ability to achieve functions that Bitcoin Treasury cannot. Especially after Ethereum co-founder and ConsenSys CEO Joe Lubin announced his joining the board of directors of SharpLink Gaming and leading its $425 million ETH Treasury investment strategy, the market realized the foresight of this move.

Soon after, many companies followed SharpLink Gaming's lead.

As of now, the top five ETH treasury companies hold a total of 5.56 million ETH, accounting for more than 4.6% of the total supply, which is worth more than $16 billion at the current price.

When investors hold an asset through encapsulation tools such as ETFs and corporate treasuries, the asset's attributes gradually align with those of a "balance sheet item." It becomes part of the corporate governance framework, requiring regular financial reporting, board discussions, quarterly performance updates, and oversight and review by the risk committee.

Furthermore, the staking feature of ETH gives the ETH treasury an advantage that the Bitcoin treasury cannot match.

Bitcoin treasuries only generate revenue for companies when they sell Bitcoin for profit; ETH treasuries, on the other hand, allow companies to earn more ETH as staking rewards simply by holding and staking ETH to provide security for the Ethereum network.

If companies can combine staking rewards with their main business revenue, they can make the ETH treasury business sustainable.

It was from this point on that the market truly began to recognize the value of Ethereum.

Ethereum, which has been keeping a low profile, has finally gained attention.

Those who have followed Ethereum's development for a long time know that Ethereum has never been good at proactive marketing. Without external events (such as the launch of asset encapsulation tools, market cycle shifts, or the emergence of new narratives) to drive it, Ethereum often remains relatively unknown until these external factors appear, at which point people rediscover its potential.

This year, the rise of ETH corporate treasuries and the surge in ETF inflows have finally brought Ethereum into the market spotlight. I measured this shift in attention in a very intuitive way: by observing whether retail investors, who typically have no interest in blockchain technology roadmaps, have started discussing Ethereum.

Between July and September of this year, Google Trends data showed a significant surge in Ethereum search interest, a trend that closely mirrors the growth momentum of ETH corporate treasuries and ETFs. These traditional asset allocation channels ignited retail investors' curiosity about Ethereum, which in turn translated into increased market attention.

But hype alone is far from enough. Market attention is always fickle, coming and going quickly. This leads to another important reason why Ethereum supporters consider 2025 a "year of great success": a key factor that is often overlooked by the outside world.

On-chain US dollar that carries the internet

If we step outside of short-term price charts and look at the bigger picture over a longer period, the fluctuations in cryptocurrency prices are merely a product of market sentiment. However, stablecoins and real-world asset tokenization (RWA) are quite different. They have solid fundamental support and serve as a bridge connecting the traditional financial system and decentralized finance (DeFi).

In 2025, Ethereum will remain the preferred on-chain platform for USD, continuing to support the circulation of stablecoins.

In the realm of real-world asset tokenization, Ethereum also holds an absolute dominant position.

As of this writing, tokenized assets issued on the Ethereum network still account for half of the total value of tokenized assets globally. This means that more than half of the world's real-world asset tokens that are available for holders to buy, sell, and manage are issued on the Ethereum network.

This demonstrates that ETFs lower the barrier for ordinary investors to buy ETH, while corporate treasuries provide investors with a path to hold ETH through compliant Wall Street channels, allowing them to gain leveraged ETH exposure.

All these developments are further promoting the integration of Ethereum with traditional capital markets, allowing investors to allocate ETH assets with peace of mind in a familiar and compliant environment.

Two major upgrades

In 2025, Ethereum underwent two major technical upgrades. These upgrades significantly alleviated network congestion, improved system stability, and greatly enhanced Ethereum's usability as a trusted transaction settlement layer.

The Pectra upgrade, officially launched in May of this year, improves Ethereum's scalability by scaling data shards (Blobs) and provides larger compressed data storage space for Layer 2 networks, thereby reducing transaction costs. This upgrade also increases Ethereum's transaction throughput, speeds up transaction confirmation, and further optimizes the operational efficiency of applications based on the Rollup scaling solution.

Following the Pectra upgrade, the Fusaka upgrade followed, further improving Ethereum's network scalability and optimizing the user experience.

Overall, Ethereum's core objective in 2025 is to optimize its evolution towards a reliable financial infrastructure. Both upgrades prioritize network stability, transaction throughput, and cost predictability. These characteristics are crucial for rollup scaling solutions, stablecoin issuers, and institutional users who need to settle value on-chain. While these upgrades have not yet created a strong correlation between Ethereum network activity and ETH price in the short term, they have significantly enhanced Ethereum's reliability in large-scale application scenarios.

Future Outlook

If we want to draw a simple and blunt conclusion about Ethereum's development in 2025, whether it's "Ethereum succeeded" or "Ethereum failed," it's probably difficult to find a clear answer.

Conversely, the market in 2025 presented a more intriguing, yet somewhat disheartening, fact:

In 2025, Ethereum successfully entered the investment portfolios of fund issuers and the balance sheets of listed companies, and has maintained market attention thanks to the continuous inflow of institutional funds.

However, ETH holders had a disappointing year, with the token price movement severely out of sync with the booming development of the Ethereum network.

Investors who bought ETH at the beginning of the year are now facing a paper loss of at least 15%. Although ETH once hit an all-time high of $4,953 in August, the good times didn't last long, and its price has now fallen back to its lowest level in nearly five months.

Looking ahead to 2026, Ethereum will continue to lead the industry thanks to its solid technological upgrades and its massive scale of stablecoins and real-world asset tokenization. If the Ethereum network can capitalize on these advantages, it has the potential to transform the momentum of ecosystem development into long-term price appreciation drivers for ETH.