Ethereum Price Declines Due to Weak Network Activity and Low Transaction Fees
The price of Ethereum is under pressure despite a broader market recovery. Key factors include:
- Weak network activity and declining active addresses since January 2025
- Record low transaction fees, the weakest since the Ethereum Merge
- Increased inflation rate due to reduced ETH burn from low transaction fees
- Impact of the Dencun upgrade, leading to higher supply than demand
- Neutral funding rates in the derivatives market, indicating low trader optimism
Year-to-date, Ethereum's price has dropped by 44%. Institutional interest appears to be waning, with net outflows of $37 million from Ethereum spot ETFs recently.
Despite stablecoin holdings nearing an all-time high of $124.5 billion and $49 billion total value locked (TVL), Ethereum’s future price movement hinges on renewed network activity. Currently trading at $1,793.58, Ethereum has seen a 67.24% increase in trading volume over the last 24 hours.