Trump Pump, Pectra Upgrade Fuel $12K ETH Forecast

• Dr. Sean Dawson from Derive predicts Ethereum’s price may hit $12,000 in 2025, driven by Donald Trump’s pro-crypto presidency and the Pectra upgrade.
• The Pectra upgrade is scheduled for Q1 2025, it merges the Prague upgrade and the Electra upgrade to enhance the network’s performance and scalability.

Ethereum’s native cryptocurrency, ETH, is poised for a significant surge in 2025, with Derive head of research Dr. Sean Dawson predicting it could reach $12,000, a 257% increase from its current value of $3,323. Ethereum’s all-time high, reached on November 10, 2021, was $4,878.26. Currently, the price sits about 30.14% lower than that peak.

This prediction is based on two factors: Donald Trump’s presidency, which will bring pro-crypto policies, and Ethereum’s Pectra upgrade. The rollout of this upgrade is expected to bring significant improvements to the Ethereum network, which could drive up its price.

Scheduled for the first quarter of 2025, the Pectra upgrade is expected to enhance Ethereum’s capabilities significantly. Dr. Sean Dawson highlights that if the upgrade is successfully implemented, it could lead to the wider adoption of real-world assets (RWAs) on the platform. Beyond that, we can expect an influx of investment into exchange-traded funds (ETFs) and a growing role for Ethereum in emerging fields such as Decentralized Physical Infrastructure Networks (DePIN) and AI agents.

Ethereum has been showing stability near the $3,500 mark since late December 2024. According to the options and derivatives markets, sentiment is overwhelmingly bullish, with 250% more call options than put options in open interest.

Donald Trump is set to be sworn in as the 47th president of the United States on January 20, and his administration’s pro-crypto stance is expected to play a key role in Ethereum’s growth. Trump has pledged to make the U.S. the “crypto capital of the planet,” signaling a potential shift toward regulatory stability. This favorable environment could not only attract institutional investment but also foster innovation.

What Can We Expect from the Pectra Upgrade?

The Pectra upgrade, combining the Prague and Electra upgrades, is set to significantly improve Ethereum’s execution and consensus layers. While Ethereum has previously undergone major updates, such as The Merge in 2022 and Cancun in 2024, it still faces notable challenges. High gas fees and lower transactions per second (TPS) compared to competitors like Solana and Binance Smart Chain have limited its scalability. Pectra aims to address these issues, revitalizing Ethereum and enhancing its competitiveness.

One of Pectra’s most significant enhancements lies in its increased staking flexibility. Validators will now be able to stake up to 2048 ETH per node, an increase from the previous 32 ETH limit. This change is complemented by EIP-7251, which introduces auto-compounding rewards for stakers. 

Additionally, slashing penalties for validators will be reduced. Previously set at 1/32 of a validator’s balance, these penalties will now drop to 1/4096, significantly lowering risks and encouraging broader participation in Ethereum’s staking ecosystem.

Beyond staking, the upgrade will introduce Peer Data Availability Sampling (PeerDAS), an initiative designed to simplify data handling for Layer 2 networks, reducing usage costs and increasing processing speeds. Furthermore, with the gradual adoption of Ethereum Improvement Proposals like EIP-7692, the Ethereum Virtual Machine (EVM) will experience substantial performance enhancements, including faster execution speeds for smart contracts.

Together, these advancements are poised to transform Ethereum. Pectra will streamline staking operations, reduce network congestion, and enhance overall efficiency, making Ethereum more attractive to institutional investors. 

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