Ethereum's long-term journey is back in the spotlight! Arthur Hayes shared a comprehensive forecast for the asset's institutional future, price potential, and competitive landscape.
Ethereum is currently trading around $3,200 and has fluctuated between $3,060 and $3,440 over the past week. Major players like Tom Lee's BitMine are ramping up their Ethereum positions at an unprecedented pace.
Ethereum Has Become an Institutional Standard
Hayes believes that the market still does not fully understand how deeply traditional institutions plan to integrate with Ethereum. According to Hayes, after years of unsuccessful attempts with private blockchains, banks have realized that they genuinely need a public consensus layer.
‘These institutions finally realized this: it cannot be done with a private blockchain; it is essential to use a public blockchain for security and real use,’ he said.
He attributes this change to the stablecoin explosion; banks have had to accept the value of on-chain consensus.
According to Hayes, Ethereum is the only platform that offers the security, liquidity, and developer pool that institutions need.
He expects this fundamental change to trigger a strong price increase for Ethereum in the upcoming cycle. He also notes that the bold treasury accumulations of companies like BitMine will support this.
BitMine purchased 33,504 ETH (112 million dollars) this week and 138,452 ETH (approximately 435 million dollars) in early December. This brings their total holdings to around 3.86 million ETH. Such a scale of accumulation indicates that institutions are preparing for the next major cycle of Ethereum.
Hayes admits that Ethereum currently lacks the privacy guarantees that large institutions require. He emphasizes that this is 'the biggest feature missing in Ethereum', but notes that Vitalik Buterin's roadmap actively addresses this issue.
Despite this shortfall, he argues that institutional adoption will not be delayed. This means companies will use Ethereum for consensus while deploying privacy-focused Layer 2 networks.
According to Hayes, Ethereum Layer 1 will continue to be the 'security infrastructure' even if transactions occur on Layer 2s like Arbitrum or Optimism.
‘How fees will be distributed between Layer 2 and Ethereum Layer 1 will certainly be discussed,’ he said, but emphasized that this would not change the fundamental reality, meaning that institutions will ensure the security of their operations with Ethereum.
These views also align with current ecosystem trends. Cryptocurrency exchange balances are at multi-year lows. According to Santiment data, ‘whales’ have accumulated over 900,000 ETH in recent weeks.
The architecture for institutions continues to shape around Ethereum's core layer, even in a declining fee environment, despite the transition to Layer 2.
First Ethereum, second Solana: Winners in a Narrow Field
Hayes believes that the future of public blockchains will consolidate within a very narrow group. While positioning Ethereum as the clear long-term winner, he sees Solana as a distant but solid second.
He attributes Solana’s rise from 7 dollars to 300 dollars to the intense meme coin activity in 2023 and 2024. However, he says Solana will need 'a new trick' to surpass Ethereum again.
While he predicts that Solana will maintain its market position, he believes that Ethereum will not reach its institutional role and long-term price strength.
Hayes finds almost all other Layer 1s structurally weak. He describes chains with high market values like Monad as overly inflated, likely to collapse after the initial pump.
Is it Possible to Become a Millionaire in the Next Election with 50 ETH?
When asked how many ETH an investor needs to hold to become a millionaire in the future, Hayes provided a clear figure for the first time.
He predicts that Ethereum could reach 20,000 dollars, and in that case, a portfolio of 50 ETH could reach a seven-figure value.
The founder of BitMex expects this price target to be reached by the next U.S. presidential election. This perspective aligns with current supply conditions: cryptocurrency exchange reserves are decreasing, institutions are accumulating, and companies like BitMine continue to acquire hundreds of millions of dollars' worth of ETH.
If Ethereum cannot meet these expectations, Hayes says this will result from a breakdown in the narrative.
He also points out that if there is a slowdown in stablecoin usage or institutions pull back from on-chain trading, Bitcoin could outpace Ethereum for a long time.
However, he believes the current market structure supports Ethereum's long-term leadership, especially as banks prepare to implement their Web3 strategies on public infrastructure.
