According to Bloomberg analyst Eric Balchunas, the most effective investment strategy in 2025 so far is to bet on the decline of Ethereum through leveraged inverse ETFs.
Two ETFs are designed to take a short position on Ether with double leverage — ProShares UltraShort Ether ETF (ETHD) and T Rex 2X Inverse Ether Daily Target ETF (ETQ) — ranked first and second in Bloomberg Intelligence's list of the best-performing ETFs this year. From the beginning of the year to April 11, ETHD has increased by approximately 247%, while ETQ has risen by 219%.
Balchunas noted that this is a "devastating" sign for Ether. As of the same day, the price of ETH had dropped by about 54%, trading around the mark of 1,555 USD.
Source: Eric BalchunasBoth of the above-mentioned ETFs use derivative instruments to reflect the volatility of Ether in the opposite direction, with volatility double that of the underlying asset. However, leveraged ETFs often do not accurately reflect the performance of the assets they track, especially over the long term.
Prolonged revenue decline
Ethereum remains the most widely used blockchain network with a total locked value of (TVL) of about 46 billion USD, according to data from DefiLlama. However, since the Dencun upgrade in March 2024 — which aimed to reduce transaction costs — the performance of the ETH token has significantly declined. Revenue from transaction fees on the network has also decreased by up to 95% after the upgrade.
The main reason is that Ethereum has not been able to optimize revenue from layer 2 scaling solutions (L2) like Arbitrum and Base — where most of the network's transactions are being processed. In the week ending March 30, Ethereum only earned 3.18 ETH from transactions on L2 chains, according to data from Etherscan.
According to Michael Nadeau, the founder of The DeFi Report, in order to recover the peak fee revenue level before the Dencun upgrade, trading volume on L2 chains will have to increase more than 22,000 times.
In addition, a report from VanEck published in April indicated that smart contract platforms such as Ethereum and Solana have both experienced a comprehensive decline in usage in Q1 2025. The reason stems from investor caution due to aggressive tax policies from President Donald Trump and the looming threat of a trade war.
You can check the coin price here.
Disclaimer:This article is for informational purposes only and is not investment advice. Investors should do thorough research before making any decisions. We are not responsible for your investment decisions.
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The strategy of betting against ETH becomes the ETF champion of 2025.
Two ETFs are designed to take a short position on Ether with double leverage — ProShares UltraShort Ether ETF (ETHD) and T Rex 2X Inverse Ether Daily Target ETF (ETQ) — ranked first and second in Bloomberg Intelligence's list of the best-performing ETFs this year. From the beginning of the year to April 11, ETHD has increased by approximately 247%, while ETQ has risen by 219%.
Balchunas noted that this is a "devastating" sign for Ether. As of the same day, the price of ETH had dropped by about 54%, trading around the mark of 1,555 USD.
Prolonged revenue decline
Ethereum remains the most widely used blockchain network with a total locked value of (TVL) of about 46 billion USD, according to data from DefiLlama. However, since the Dencun upgrade in March 2024 — which aimed to reduce transaction costs — the performance of the ETH token has significantly declined. Revenue from transaction fees on the network has also decreased by up to 95% after the upgrade.
The main reason is that Ethereum has not been able to optimize revenue from layer 2 scaling solutions (L2) like Arbitrum and Base — where most of the network's transactions are being processed. In the week ending March 30, Ethereum only earned 3.18 ETH from transactions on L2 chains, according to data from Etherscan.
According to Michael Nadeau, the founder of The DeFi Report, in order to recover the peak fee revenue level before the Dencun upgrade, trading volume on L2 chains will have to increase more than 22,000 times.
In addition, a report from VanEck published in April indicated that smart contract platforms such as Ethereum and Solana have both experienced a comprehensive decline in usage in Q1 2025. The reason stems from investor caution due to aggressive tax policies from President Donald Trump and the looming threat of a trade war.
You can check the coin price here.
Disclaimer: This article is for informational purposes only and is not investment advice. Investors should do thorough research before making any decisions. We are not responsible for your investment decisions.
Thach Sanh
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