Citi Report: Ether Decline Shows Resilience as TVL and Investor Sentiment Improve
Ether (ETH) has seen a significant drop of over 20% this year, but its fundamentals are showing positive signs, according to a new report from Wall Street bank Citi released on Monday.
Despite this year’s decline, analysts led by Alex Saunders noted that the outlook for Ether isn’t entirely negative. While user activity has been volatile in recent weeks, they emphasized that the overall foundation is improving.
One of the most promising signs is the surge in Total Value Locked (TVL) on the Ethereum network, which has experienced considerable growth. Additionally, Ether ETFs continue to see inflows, and search interest in the cryptocurrency is rising, signaling that investor sentiment is improving.
Citi highlighted that after the U.S. election in November, Ether ETFs turned positive, bringing in $3.2 billion in inflows since their launch in July. This indicates that investor confidence in Ether remains strong, even in the face of market challenges.
However, the report did acknowledge increasing competition from layer-2 solutions and blockchains like Solana, which have seen stronger user growth, raising questions about Ethereum’s ability to maintain its competitive advantage.
The report also mentioned President Trump’s World Liberty Financial’s $200 million-plus position in Ether, noting that this could be seen as extra motivation for the U.S. to strengthen its support for the crypto industry.
Citi concluded by noting that Ether’s performance weakness coincides with Bitcoin’s (BTC) increasing dominance, which is now at multi-year highs above 60%. The relative performance of Ether and altcoins could serve as an indicator of market optimism about regulatory clarity in the U.S. crypto space.
Share this content:
