Ethereum has maintained its leadership in stablecoins and tokenization. However, despite significant liquidity, activity has declined.
Decline in Ethereum Activity
Ethereum's stablecoin supply hit $130 billion, and tokenized treasuries like BUIDL surpassed $1.8 billion in assets. Nonetheless, activity has decreased, with the ETH/BTC ratio dropping to a five-year low.
Economic Changes in Ethereum Network
The introduction of EIP-4844 in the Dencun upgrade significantly altered network economics. Fees dropped from $30 million in March 2024 to around $500,000 as much of the execution moved to Layer 2s. Concerns about value leakage have arisen as the main chain covers security costs, yet Layer 2s reap most economic benefits.
The Future of Ethereum: Plans and Forecasts
With future upgrades such as Pectra and Fusaka, Ethereum aims to increase blobspace and Layer 2 transactions, expecting this to enhance fees and boost ETH's long-term value. The focus is on expanding staking opportunities and launching staked Ether ETFs.
Ethereum remains a leader in tokenization but faces scaling and value leakage challenges. Upcoming upgrades may strengthen its market position.
