Ethereum’s Ether (ETH) has struggled to keep up with other cryptocurrencies over the past 18 months. While ETH has grown by 88% in that timeframe, coins like Solana (SOL) and Sui (SUI) have skyrocketed, with gains of 1,040% and 448%, respectively.

ETH’s performance took a hit in 2024 as it found itself overshadowed by two major trends: Bitcoin attracting institutional investors and Solana gaining popularity among retail traders. This left Ethereum in an awkward middle ground, according to experts.

However, some analysts believe the upcoming U.S. presidency of Donald Trump could turn things around for Ethereum. Trump’s administration is expected to take a crypto-friendly stance, especially since his family launched a decentralized finance (DeFi) project, World Liberty Financial, on Ethereum. This move signals a potential boost for the platform.

Heading into 2025, several factors could improve ETH’s standing: changes in U.S. financial regulations, a more supportive Securities and Exchange Commission (SEC), the introduction of staking features for Ether ETFs, and increased oversight from the Commodity Futures Trading Commission (CFTC). These shifts could create a more welcoming environment for Ethereum and its ecosystem.

Meanwhile, Solana’s recent price drop—from an all-time high of $264 to $192—has raised concerns about upcoming token unlocks, which could increase selling pressure. This could further position Ethereum to reclaim its dominance.

Ethereum’s struggle hasn’t been helped by aggressive regulatory scrutiny under the current SEC leadership. Projects like Uniswap, Consensys, Lido, and Rocket Pool have faced investigations, while speculative meme coins have largely avoided attention. Many disillusioned crypto investors have moved toward these high-risk, low-utility assets, a trend some experts call “financial nihilism.”

Financial nihilism thrives on ignoring fundamentals and seeking quick gains. In contrast, Ethereum’s value lies in its strong fundamentals, utility, and its promise as a platform for smart contracts and decentralized finance.

Trump’s pro-crypto stance could shift this dynamic. His administration plans to overhaul the SEC, nominating crypto-friendly officials like former SEC Commissioner Paul Atkins for leadership roles. With key Democratic commissioners stepping down, there’s potential for a more crypto-supportive regulatory landscape.

These changes could particularly benefit legitimate sectors like DeFi and decentralized infrastructure projects. With fewer regulatory hurdles, these areas could attract institutional interest and drive innovation.

The Biden-era SEC has been criticized for targeting DeFi projects and proposing rules that classify them as traditional exchanges. Under Trump’s administration, this approach is expected to change. There’s also speculation that the CFTC will take a more active role in regulating crypto, which could benefit Ethereum since the CFTC has classified Ether as a commodity.

The Financial Innovation and Technology for the 21st Century Act (FIT21), which seeks to establish federal crypto regulations and shift oversight to the CFTC, could play a key role in shaping the industry. Even if the bill doesn’t pass, Trump’s administration might independently give the CFTC more power over crypto regulation.

Trump’s involvement with World Liberty Financial further highlights his support for Ethereum and DeFi. The project has invested heavily in ETH and other related assets, signaling confidence in the ecosystem. Industry insiders believe this could lead to faster regulatory changes and greater acceptance of crypto under Trump’s leadership.

Additionally, there’s growing optimism around Ether ETFs incorporating staking rewards. With staking yields currently around 3.1%, such ETFs could attract institutional investors by offering both price exposure and passive income. If approved, these developments could significantly boost Ethereum’s appeal.

As U.S. interest rates are expected to drop in 2025, ETH staking yields of 4%-5% could become even more attractive compared to traditional financial products. Experts predict that these factors will improve Ethereum’s economic model and encourage wider adoption among both retail and institutional investors.

In summary, while Ethereum has faced challenges recently, shifting regulatory landscapes and new opportunities under Trump’s administration could pave the way for a strong comeback. From DeFi growth to ETF innovation, ETH is positioning itself as a cornerstone of the digital finance future.