Institutional Adoption Advances for Ethereum in 2025 Amid Bitcoin's Holiday Trading Challenges
In 2025, Ethereum solidified its position as the default platform for traditional finance, with major banks and tech firms increasingly utilizing Ethereum's layer-2 networks to tokenize assets and operate on-chain services. This shift was bolstered by the July 2025 signing of the GENIUS Act, which established a legal framework for issuing and trading stablecoins in the United States and legitimized crypto activities on blockchains, accelerating Wall Street participation.
The Ethereum Foundation transitioned from an ivory-tower image to active enterprise engagement, creating dedicated teams to help enterprises integrate with Ethereum and organizing one-day conferences focused on staking, privacy, and enterprise use cases. Additionally, Ethereum’s AI initiative expanded with a full-time team and collaborations with major tech companies like Google, aiming to incorporate AI bots as core network users.
Notable institutional adopters included Base (a layer-2 on Ethereum), Fidelity tokenizing assets on Ethereum, SWIFT, Robinhood building its own layer-2 on Ethereum, and other institutions such as Upbit (Korea), Ant Group (China), IHC (Abu Dhabi), Amundi (Europe), and Baillie Gifford (UK). Motivations for adopting Ethereum featured efficiency, automation, reduced counterparty risk, broader access to capital, and a balance of transparency and privacy, with a multi-layer Ethereum model being followed.
In contrast, Bitcoin remained range-bound between $85,000 support and $93,000 resistance heading into Christmas amid thinning liquidity and year-end de-risking, according to QCP Capital. Overnight perpetual open interest declined by about $3 billion for Bitcoin and $2 billion for Ethereum, signaling reduced leverage and potential for sharp price moves. The looming Boxing Day and Friday options expiries involve roughly 300,000 BTC options contracts valued at $23.7 billion and 446,000 IBIT contracts expiring, comprising more than half of Deribit's open interest.
Tax-loss harvesting ahead of December 31 could amplify near-term volatility; however, holiday-driven moves are historically mean-reverting as liquidity returns in January. On-chain metrics indicate weakening buying pressure, with CryptoQuant reporting declining buy-volume divergence in Binance futures and falling active address counts. Bitcoin ETFs experienced $461.8 million in outflows over three days, led by BlackRock ($173.6 million) and Fidelity ($170.3 million), although spot holdings fell less than 5% despite an approximate 30% price drawdown.
Despite recent downturns, global crypto exchange-traded products (ETPs) have attracted about $87 billion in net inflows since January 2024, showing strong institutional interest with holders largely maintaining positions through the decline. Analysts present scenarios of continued volatility, with a possible bottom near $71,000–$84,000 for Wave IV and a longer-term target between $145,000–$160,000 for Wave V. Some projections anticipate Bitcoin revisiting $100,000–$120,000 in the second quarter of 2026.
After years of hesitation, institutions have grown confident in committing to Ethereum as crypto gains legitimacy, paralleling 2024's notable moves such as BlackRock's increased engagements and the GENIUS Act facilitating a permissible on-chain finance environment. Meanwhile, Bitcoin is expected to remain somewhat constrained until 2026, influenced by holiday liquidity conditions and market dynamics.
