Ethereum needs a breath of fresh air if it wants to remain relevant for crypto
Once there was the darling of the blockchainer, but these days seem to be counted: Ethereum, which is still the second largest blockchain after market capitalization worldwide, faces significant challenges. The network activity and the income from transaction fees have decreased drastically since its climax in the fourth quarter of 2021 (ETH at that time ETH had his all -time high at around $ 4,900). At the same time, alternative Smart Contract platforms such as Solana, Tron and others are gaining in popularity and increasingly putting Ethereum under pressure.
The all-time highs, which reached other cryptocurrencies in the Trump Pup, are the most clearly that Ethereum is no longer “en vogue”. Bitcoin achieved almost $ 110,000, Solana, a new ATH at around $ 295. Ethereum-and many other old coins, mind you-did not manage in this market phase that the all-time high of 2021.
Since “The Merge”, ie the change from Proof of Work to Proof of Stake, has not happened much at Ethereum. The Ethereum ETFs are still in the shadow of the Bitcoin ETFs, the Dencun upgrade of 2024 strengthens Spent Layer 2 solutions, but less Ethereum itself (More about this here).
Agency of transaction fees and network activity
Ethereum also shows weakness in other data points: The income from transaction fees on the blockchain has dropped by an impressive 95 %-from a maximum of $ 4.3 billion in Q4 2021 to an estimated $ 217 million in Q1 2025. This decline can be attributed to several factors:
- Layer 2 solutions: Platforms such as Arbitrum and Optimism, which process transactions more efficiently outside the main blockchain, have reduced the costs for users, but also reduced the income for Ethereum. The introduction of EIP-4844 continued to promote this development.
- Decisive interest in NFTS: The boom of the NFT market, which brought Ethereum enormous income in 2021, has been significantly reduced. Platforms such as OpenSea record significantly lower trading volumes.
- Stable coins on many chains: The stable coins that are important for the ecosystem are now spread over many different blockchains. Usdt from Tether, for example, currently has around $ 74 billion of tokens on Ethereum, but already 64 billion at Tron.
In addition to the falling fees, the number of active addresses and new wallet ideas fell to a record low. On March 16, 2025, only 361,078 active addresses were registered – the lowest value in a long time. This development reflects a decreasing demand for transactions and increases the inflation -related pressure on Ethereum.
Price development and market changes
Ethereum's price has given up 57 % since its all-time high in November 2021 and is currently noted at around $ 2,100. In the first quarter of 2025, Ethereum experienced its largest quarterly decline since 2018 with a minus of 40 %. The loss of price is reinforced by the weak network activity and increasing competition.
While Ethereum is fighting technical challenges, competing platforms such as Solana, Tron and Cardano become more important:
- Solana: With its proof-of-history consensus mechanism, Solana offers extremely fast transaction speeds (up to 65,000 transactions per second) and low fees. As reported several times, Solana has become the home of many memo coins. Trump's Memecoin Trump or that of his wife (Melania), for example, run on Solana and not on Ethereum.
- Tron: Tron scores with high scalability (up to 2,000 transactions per second) and an efficient infrastructure that supports applications such as Tether and Bittorrent.
- Mantra: This Layer 1 Blockchain has developed into an important point of contact for all those who want to tok real estate.
These platforms offer more cost -effective and more scalable solutions than Ethereum, which increasingly attracts developers and users.
Vitalik Buterin knows that Ethereum has to progress
Ethereum is at a turning point. In order to assert its market leadership, the network urgently has to advance innovations in order to improve scalability and increase user -friendliness. Ethereum founder Vitalik Buterin also knows that. Buterin has recently made several suggestions for Ethereum that concentrate on scalability, efficiency and user-friendliness.
The current PECTRA upgrade (March 2025) brings important improvements such as the doubling of the blob capacity, the introduction of “Account Abstraction” (EIP-7702) for programming wallets as a smart contracts and increasing the maximum staking amount per validator (EIP-7251). In addition, EIP-4444 is reduced by the network lane by leaving old data. But all of this is not the big throw that many expect.
In the long term, the Ethereum community is therefore planning the Fusaka upgrade (2026), the Peer Data Availability Sampling (Peerdas) and an extended blob capacity in order to further increase network performance. In addition, butterin is working on the further development of the Sharding technology to scale Ethereum to up to 100,000 transactions per second.
