Institutions are bullish on 2026: Why can Ethereum outperform the market?

【Blockchain Rhythm】Large financial institutions’ views often reflect certain market trends. Recently, news has emerged that the digital asset research team of a well-known international bank has published its latest outlook on Ethereum’s prospects. Its global head explicitly stated in the latest report that 2026 will be a year for Ethereum, similar to the market landscape of 2021.

The analyst emphasized that although the entire crypto market is under pressure and the bank has downgraded its recent price forecasts, Ethereum is expected to perform better relative to other cryptocurrencies. He believes the key driving force comes from the accelerated growth in blockchain technology and on-chain product adoption.

Interestingly, the report points out a phenomenon: Bitcoin’s dominant position in the market is strong, but its performance has not met expectations, which weakens the overall digital asset sector’s upward momentum against the US dollar. However, compared to Bitcoin, Ethereum’s attractiveness is increasing. Institutions expect the ETH/BTC exchange rate to gradually return to the high of about 0.08 seen in 2021, based on the logic that Ethereum possesses structural advantages that are difficult for other cryptocurrencies to replicate.

What are these advantages? The absolute leading position of the stablecoin ecosystem, the accumulation of real-world assets(RWA), and deep deployment in the DeFi sector. Additionally, ongoing network expansion is also a reflection of long-term competitiveness. Especially, the plan to improve Layer 1 throughput is seen as critical, because historical data shows that higher throughput often correlates with higher network market value. The Fusaka upgrade in December last year was an important step in this direction.

From a policy perspective, the US “Clarity Act” is expected to advance in the first quarter, which will improve the regulatory environment for digital assets. Coupled with the resilience of the US stock market, institutions believe that such policy favorable factors could push Bitcoin to a new all-time high in the first half of the year, and as the most active blockchain platform in the ecosystem, Ethereum is bound to benefit from this.

It is worth noting that the institution’s attitude towards Ethereum and Bitcoin has diverged. While the short-term price target for Ethereum has been lowered, the long-term outlook has become more optimistic. Specifically, the forecast for the end of 2026 has been adjusted to $7,500 (previously $12,000), with a 2027 target of $15,000 and a 2028 target of $22,000. However, the long-term expectations have actually been raised — the forecast for the end of 2029 is $30,000, and a new target of $40,000 by the end of 2030 has been added. This adjustment reflects the institution’s confidence in Ethereum’s long-term prospects, despite more conservative short-term predictions.