Fidelity Predicts Who Will Lead In 2025
Fidelity Digital Assets, a subsidiary of global financial services company Fidelity Investments, has released a new Paper Titled “2025 Outlook: Is it ‘too late’ to get into digital assets?” the publication is highly focused on the ongoing competition between Ethereum and Solana. The “Ethereum Outlook” section, written by Max Wadington, details fundamental indicators, upcoming network upgrades, and the broader implications for investors in 2025.
Solana VS. Ethereum in 2025
In a key excerpt comparing Solana and Ethereum, Wadington explains: “We believe fundamentals are most important for long-term investors. Having said that, Ethereum has strong developer activity, total value locked (TVL) and stablecoin supply, Solana’s revenue and TVL have grown faster than Ethereum’s and appear to have gained significant community attention over the past year.”
One factor complicating Solana’s growth trajectory is its revenue stream, which is heavily influenced by: memecoin trading. Wadington noted that while “a similar argument could be made for Uniswap, Ethereum’s primary use case,” Ethereum’s fundamentals are “slightly less reliant on speculation and may be less volatile in the long term.” Therefore, the two No platform is without risk, but Ethereum’s broader uses may make it more resilient in a bear market.
Related reading
Still, near-term narratives and technical milestones could tilt sentiment in Solana’s favor in 2025. Specifically, Solana’s upcoming Fire Dancer Upgrade “Promises a significant increase in transactions per second (TPS), which may directly enhance Solana’s value proposition.” Meanwhile, Ethereum’s Prague/Electra upgrade “is expected to reduce community hype as it will not be significantly Impacting Ethereum’s Value Proposition.”
Another key difference is the presence of Ethereum U.S. spot exchange-traded funds (ETFs), Accessible channels that help drive institutional and retail demand. However, Waddington stressed that this advantage “will likely disappear at some point under the Trump administration,” pending regulatory developments that “could solidify Ethereum’s advantage in this space or eliminate it entirely.”
Related reading
Ultimately, Wadington said that as the market develops, fundamentals may regain its footing amid the hype: “While Solana appears to have more short-term tailwinds than ETH, its relative performance could provide significant upside for Ethereum. Room for upside, similar to Solana’s previous underperformance provides Ethereum with significant room for upside heading into 2024, as investors become increasingly focused on fundamentals, which could prompt them. Reinvest in Ethereum.”
Has Ethereum made a mistake?
Focusing specifically on Ethereum, this article delves into the ongoing debate surrounding Ethereum’s rollup-centric roadmap. In Wadington’s words: “The Rollup-centric roadmap was designed to scale Ethereum while keeping Layer 1 blockchains easy to run. However, since the Deneb-Cancun upgrade, with Layer 1 fees dropping significantly, there has been growing interest in This decision has been controversial.”
While lower fees may be detrimental to Ethereum holders’ immediate income, Fidelity’s position is that the long-term benefits outweigh the short-term revenue decline. Waddington reiterated: “We continue to believe that revenue from the blob market is unlikely to offset the significant revenue decline from previous upgrades in the short term, but it will still provide long-term positive benefits through improved network effects.”
From this perspective, Ethereum’s ecosystem will benefit from a mutually beneficial relationship with Layer 2, which inherits Ethereum’s security and liquidity. As Wadington wrote, the foundation’s top priority is ensuring “Layer 2 remains in the Ethereum ecosystem with near-zero fees.” This will likely breed more specialized layer 2 projects in 2025 as developers tailor entire technology stacks for niche use cases like the Ethereum Name Service (ENS).
At press time, Solana was trading at $197.
Featured image created using DALL.E, chart from TradingView.com
