Ethereum (ETH) has made a commendable leap alongside Bitcoin (BTC), successfully reclaiming the $3,000 threshold. This price rebound may well represent a critical turning point for the cryptocurrency, hinting at the possibility of a new upward trajectory. Nevertheless, the investment community appears split on whether ETH will experience further downturns or if a year-end rally could reawaken bullish sentiment.
ETH’s Historical Dilemmas in December
To gauge Ethereum’s potential moves this December, analyst Alex Carchidi from The Motley Fool provides valuable insights, noting that December has often been a challenging time for cryptocurrencies. Over the past nine years, Ethereum has only wrapped up December with positive returns four times since 2016.
In the remaining five years, it faced declines, with an average return for December hovering around 7%—suggesting that a robust “Santa rally” is unlikely. The median performance indicates a drop of about 6%.
Connected Insights
By diving deeper into the relationship between the performances of November and December, a more defined trend emerges. Data collected from 2016 to 2024 illustrates that when November is weak for ETH, December frequently follows suit, with three out of four instances reflecting declines.
The only exception to this pattern was in 2018 when Ethereum managed to bounce back after a harsh November. This historical context suggests a pattern where poor performance in November may extend into December, making a festive month less probable.
Despite the mixed historical performance for December, it is worth noting that the start of the following year usually offers more favorable prospects for Ethereum, especially during the first and second quarters.
In fact, the average returns in the first quarter can peak around 77%, with the second quarter following closely at approximately 64%, indicating that there could still be substantial growth ahead for Ethereum.
Tom Lee Envisions a Surge for Ethereum
In light of these speculative scenarios, Tom Lee, chairman of BitMine Immersion Technologies and an influential voice in the cryptocurrency space, forecasts a promising future for Ethereum both in the short and long term.
Lee posits that the cryptocurrency could potentially skyrocket to $7,000 by the first quarter of 2026, marking an astonishing almost 150% price increase from its current valuation.
Relevant Insights
He is even more sanguine about the long-term prospects, suggesting that should his vision of a decentralized financial ecosystem come to fruition, Ethereum could soar by an extraordinary 2,090% to hit $62,000 by the year 2035.
Following a tumultuous year where ETH fell behind its competitors, the cryptocurrency has started to show signs of resilience, especially after last week’s market crash, which saw it dropped to as low as $2,600 on Friday.
As it stands, ETH is currently trading slightly above the $3,000 mark. Although it hasn’t fully recovered from recent losses, the token is well-positioned for a significant rebound if demand and investments return to exchange-traded funds (ETFs) as the year draws to a close.
Featured image from DALL-E, chart from TradingView.com
