Declining ROI in Cryptocurrencies: A Shift Towards New Projects for High Returns

Cryptocurrency analyst Joao Wedson argues that returns on investment for major cryptocurrencies like Bitcoin and Ethereum have been declining each year, making it increasingly difficult to amass large fortunes with small capital. Wedson suggests that investors can only achieve high returns by taking positions in new projects at an early stage, but notes that this is a complex process and carries high volatility risk. He also warns that increasing leverage ratios in stock exchanges can cause losses and drain market liquidity.

The cryptocurrency market in 2025 has witnessed a seismic shift in investor preferences, with Ethereum ETFs outperforming Bitcoin ETFs in both inflows and institutional adoption. This divergence is not merely a short-term anomaly but a reflection of deeper structural changes in market sentiment, regulatory clarity, and technological momentum.

ETF Flows: A Tale of Two Assets

In August 2025, U.S. spot Ethereum ETFs attracted over $4 billion in net inflows, while Bitcoin ETFs faced outflows totaling $966 million [1]. This trend has persisted for two months, with Ethereum ETFs securing $9.5 billion in inflows compared to Bitcoin’s $5.4 billion [4]. The disparity is stark: Ethereum ETFs have seen a five-day streak of positive inflows, including a record $309.5 million on August 27, driven by BlackRock’s iShares Ethereum Trust (ETHA) alone [5]. In contrast, Bitcoin ETFs, led by BlackRock’s iShares Bitcoin Trust (IBIT), managed only $81.2 million in daily inflows during the same period [6].

The institutional bid for Ethereum is further underscored by investment advisers becoming the largest holders of Ethereum ETFs, injecting over $1.3 billion in Q2 2025 [1]. This contrasts with Bitcoin’s institutional landscape, where whales increasingly prioritize long-term cold storage, as seen in a July 2025 transfer of 40,000 BTC ($4.35 billion) [2].

Market Sentiment: From Speculation to Staking

Ethereum’s appeal lies in its deflationary supply model, staking yields, and regulatory clarity. The U.S. Securities and Exchange Commission’s (SEC) informal classification of Ethereum as a commodity—rather than a security—has removed a critical legal barrier for institutional investors [5]. This development has spurred corporations like SharpLink Gaming to shift treasuries to Ethereum, now holding 280,706 ETH (≈$867 million) [5].

Meanwhile, Ethereum’s Total Value Locked (TVL) surged to $200 billion by Q2 2025, driven by DeFi protocols and Layer 2 solutions [2]. This utility-driven narrative contrasts with Bitcoin’s role as a “digital gold” store of value, which has seen bearish short-term signals, such as the UK government’s potential sale of 61,000 BTC [5].

Macroeconomic and Analyst Dynamics

Ethereum’s outperformance is also tied to macroeconomic factors. As interest rates stabilize and equity markets favor tech-driven assets, Ethereum’s correlation with innovation sectors has strengthened [3]. Analysts predict Ethereum could surpass $6,100 by year-end and $12,000 by 2030, fueled by a short squeeze that pushed its price from $3,000 to $3,800 in a week [4]. Bitcoin, meanwhile, fell 11.82% in Q1 2025 compared to Ethereum’s 45% drop [6], signaling a shift in risk appetite.

Conclusion

The 2025 ETF landscape reveals a clear preference for Ethereum over Bitcoin, driven by institutional confidence, regulatory clarity, and a utility-driven ecosystem. While Bitcoin remains a cornerstone of crypto, Ethereum’s technological evolution and staking yields have redefined its role as a dynamic, income-generating asset. For investors, this shift underscores the importance of aligning portfolios with assets that offer both growth and governance.

References:
[1] Ethereum ETFs on track for $4 billion in August inflows [https://www.theblock.co/post/368774/ethereum-etfs-on-track-for-4-billion-usd-august-inflows-while-bitcoin-funds-face-outflows]
[2] Altcoin Liquidity and TVL Trends in 2025 [https://www.ainvest.com/news/altcoin-liquidity-tvl-trends-2025-defi-reshapes-trading-dynamics-investor-entry-points-2508/]
[3] Ethereum's Outperformance Over Bitcoin as a Leading Indicator of Equity Market Tops and Rallies [https://www.ainvest.com/news/ethereum-outperformance-bitcoin-leading-indicator-equity-market-tops-rallies-2508/]
[4] Ethereum (ETH) Price Prediction 2025 2026 2027 - 2030 [https://changelly.com/blog/ethereum-eth-price-predictions/]
[5] Why Ethereum Is Surging: Expert Forecasts, Whale Buying, and the Future of ETH in 2025 [https://yellow.com/research/why-ethereum-is-surging-expert-forecasts-whale-buying-and-the-future-of-eth-in-2025]
[6] Q1 2025 Crypto Market Review: Trends, Challenges, and Outlook [https://caldwelllaw.com/news/q1-2025-crypto-market-review-trends-outlook/]