Why Ethereum Could Outperform The Market<\/h2>\n
Despite ETH\u2019s growing adoption, Liu argues that its underperformance relative to Bitcoin stems from \u201cinstitutional timing.\u201d According to him: \u201cETH is institutionally driven, unlike Bitcoin or retail-favored altcoins. ETFs provide stability and utility, making ETH ideal for institutional investors.\u201d Liu suggests institutions have been waiting for market conditions to improve and sees 2025 as the year when these conditions finally align.<\/p>\n
Liu also points to the US Federal Reserve\u2019s policy shifts as a catalyst for ETH\u2019s growth. He notes that since May 2024, the Fed has been slowing its balance sheet reductions, and a possible pivot toward renewed liquidity injections could occur after the January 29 or March 19 Federal Open Market Committee (FOMC) meetings.<\/p>\n
\u201cSince May 2024, the Fed has slowed balance sheet reductions, signaling a pivot. A liquidity boost could follow Jan 29 or Mar 19 FOMC meetings. Why it matters: Fed liquidity<\/a> pumps historically drive ETH\/BTC higher.\u201d He concludes that such a move by the Fed \u201cmeans ETH outperformance\u201d could be on the horizon.<\/p>\n
Citing a decade of market data, Liu claims ETH typically outperforms Bitcoin from January to June, while Bitcoin tends to lead from July to December. \u201cFrom January to June, ETH consistently outperforms Bitcoin. \u2026 If you\u2019re holding ETH, now until June is historically the best window for gains.\u201d<\/p>\n
ETHBTC, 1-week chart | Source: X @VirtualBacon0x<\/figcaption><\/figure>\n
Liu also highlights potential pro-ETH sentiments from the Trump administration, referencing the former president\u2019s NFT collections and DeFi platform built on Ethereum: \u201cHis NFT collections<\/a> and DeFi platform are built on Ethereum. Trump\u2019s administration plans to replace SEC leadership, revisiting anti-DeFi rulings. Institutional optimism surged after Trump\u2019s election win in Nov 2024, driving ETF inflows.\u201d He concludes that \u201cpro-crypto policies will directly benefit Ethereum-focused DeFi.\u201d<\/p>\n
Further emphasizing Ethereum\u2019s institutional strength, Liu points to real-world asset (RWA) tokenization initiatives by major firms like BlackRock<\/a> and prominent DeFi platforms such as AAVE, MakerDAO, and OriginTrail: \u201cEthereum isn\u2019t leading meme coin or AI trends \u2013 it\u2019s powering serious institutional growth.\u201d<\/p>\n
Liu underscores a notable shift in Ethereum ETF inflows, which turned positive in November 2024 after a period of outflows: \u201cETFs added $6B in net inflows from Nov to Jan, or 0.76% of ETH supply\/month. \u2026 Institutions are buying more ETH than BTC monthly, signaling growing confidence in Ethereum as an asset.\u201d<\/p>\n
Projecting out to 2025, Liu believes ETH could quadruple to $14,000 if Bitcoin doubles to $200,000, citing Ethereum\u2019s historical tendency to outperform Bitcoin by an additional factor of two: \u201cIf Bitcoin doubles to $200K, ETH could 4x to $14K, following its historical outperformance (2x on top of BTC). \u2026 While diminishing returns may limit upside, ETH remains a high-conviction bet for this cycle.\u201d<\/p>\n
Summarizing his perspective, Liu stresses that a confluence of factors\u2014from renewed Fed liquidity to potential pro-DeFi policies\u2014creates a near-term window of opportunity for Ethereum: \u201cWith ETF inflows rising, the Fed\u2019s potential liquidity injection, Trump\u2019s pro-DeFi stance, and ETH\u2019s seasonal strength, all the catalysts are aligned. \u2026 Ethereum\u2019s time to shine is now until June. I\u2019d rather be overexposed than miss this opportunity.\u201d<\/p>\n
At press time, ETH traded at $106,929.<\/p>\n
$\"Bitcoin$
Bitcoin price, 4-hour chart | Source: BTCUSDT on TradingView.com<\/a><\/figcaption><\/figure>\n
Featured image created with DALL.E, chart from TradingView.com<\/p>\n<\/p><\/div>\n\n","protected":false},"excerpt":{"rendered":"
In a thread on X today, January 20, Dennis Liu (@VirtualBacon0x), a general partner at Momentum 6, laid out a bold forecast for Ethereum (ETH), suggesting the world\u2019s second-largest cryptocurrency could reach a price target of $14,000 by the end of 2025. Liu also contends that the next six months will be pivotal, highlighting ETH\u2019s […]<\/p>\n","protected":false},"author":1,"featured_media":34194,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[335],"tags":[337,10598,533,10134,668,712],"class_list":["post-34193","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto-news","tag-ethereum","tag-expert","tag-months","tag-predicts","tag-surge","tag-takeover"],"_links":{"self":[{"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/posts\/34193","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/comments?post=34193"}],"version-history":[{"count":0,"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/posts\/34193\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/media\/34194"}],"wp:attachment":[{"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/media?parent=34193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/categories?post=34193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lsd.hu\/wp-json\/wp\/v2\/tags?post=34193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}