{"id":839369,"date":"2025-04-06T08:12:10","date_gmt":"2025-04-06T13:12:10","guid":{"rendered":"https:\/\/newsycanuse.com\/index.php\/2025\/04\/06\/why-is-ethereum-price-underperforming-in-2025\/"},"modified":"2025-04-06T08:12:10","modified_gmt":"2025-04-06T13:12:10","slug":"why-is-ethereum-price-underperforming-in-2025","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2025\/04\/06\/why-is-ethereum-price-underperforming-in-2025\/","title":{"rendered":"Why Is Ethereum Price Underperforming in 2025?"},"content":{"rendered":"
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\"Ethereum<\/figure>\n<\/div>\n
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Ethereum (ETH)<\/a>, the world\u2019s second-largest cryptocurrency by market value, is going through a rough patch. After nearly a decade of being a major force in the crypto world, ETH has seen a sharp decline in 2025\u2014its price falling by around 46% in the first quarter.<\/p>\n

Ethereum\u2019s transaction fees have dropped to their lowest point since 2020, showing a big change in how people are using the network. According to blockchain analytics firm IntoTheBlock<\/em>, total fees collected on Ethereum fell by nearly 60% in Q1 2025, reaching just $208 million by early April.<\/p>\n

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Total ETH fees decreased to their lowest level since 2020 this quarter, primarily driven by the gas limit increase and transactions moving to L2s pic.twitter.com\/CLmOFfttwa<\/a><\/p>\n

\u2014 IntoTheBlock (@intotheblock) April 4, 2025<\/a><\/p><\/blockquote><\/div>\n<\/figure>\n

Consequences of a Slower Burn Rate<\/strong><\/h2>\n

Another concern is Ethereum\u2019s slowing burn rate. This rate is important because it helps reduce the number of ETH in circulation. But with fewer transactions happening, the amount of ETH being burned has dropped. In fact, fees from major platforms like Uniswap, MetaMask, and Tether have dropped by over 95% since late 2024.<\/p>\n

As a result, Ethereum\u2019s inflation rate is starting to rise. DeFi analyst Michael Nadeau has warned that Ethereum\u2019s inflation could soon be higher than Bitcoin\u2019s<\/a>, which could worry long-term holders.<\/p>\n

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ETH burned is currently at its lowest level since EIP1559 was implemented in August of ’21. <\/p>\n

The drivers:<\/p>\n

Burned ETH from Uniswap is down 99% in March compared to November. <\/p>\n

Burn from Tether is down 95% over the same period. <\/p>\n

MetaMask burn is down 97%. 1inch is down 99%.\u2026 pic.twitter.com\/wJFW6W46sK<\/a><\/p>\n<\/div>\n

\u2014 Michael Nadeau | The DeFi Report (@JustDeauIt) April 3, 2025<\/a><\/p><\/blockquote><\/div>\n<\/figure>\n

Layer-2 Networks Are Taking Over<\/strong><\/h2>\n

A major reason for the drop in fees is the growing use of Layer-2 (L2) networks. These are built on top of Ethereum and offer faster and cheaper transactions. One of the top performers is Coinbase\u2019s Base<\/em> network, which now processes more than 80 transactions per second\u2014more than any other L2 solution.<\/p>\n

Ethereum\u2019s Dencun<\/em> upgrade, launched in March 2024, made L2 transactions even cheaper. This encouraged users to shift away from Ethereum\u2019s main network to these faster alternatives, which led to fewer transactions and lower fees on the main network.<\/p>\n

Also Read: FTX Rejects Nearly 400,000 Claims Worth $2.5 Billion \u2013 Here\u2019s What Happened<\/a><\/p>\n

ETH\/BTC Performance Drop to 5-Year Low<\/h2>\n

Ethereum is also falling behind Bitcoin in terms of price performance. Since the start of 2025, ETH has dropped from over $3,300 to $1,805 as of April 4. Meanwhile, Bitcoin reached an all-time high of $109,000 and has only fallen about 10%. Ethereum, by contrast, has lost 45% of its value, pushing the ETH\/BTC ratio to its lowest point in five years.<\/p>\n

Big Investors Still Buying the Dip<\/strong><\/h2>\n

Even with all the recent setbacks, some large investors remain confident in Ethereum\u2019s long-term future. IntoTheBlock reports that Ethereum \u201cwhales\u201d have bought more than 130,000 ETH after the price fell below $1,800. This shows that many still believe in Ethereum\u2019s recovery.<\/p>\n

Some analysts are predicting a strong rebound, saying ETH could reach $5,000<\/a> by the end of 2025. Others are even more optimistic, suggesting it could go above $10,000 in the future.<\/p>\n

Can the Pectra Upgrade Turn Things Around?<\/strong><\/p>\n

Looking ahead, Ethereum\u2019s upcoming Pectra<\/em> upgrade, expected in May, could help improve the network\u2019s performance. If successful, it might give ETH the boost it needs to regain momentum and attract more activity back to the main network.<\/p>\n<\/div>\n

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\n Mustafa Mulla<\/p>\n","protected":false},"excerpt":{"rendered":"

Ethereum (ETH), the world\u2019s second-largest cryptocurrency by market value, is going through a rough patch. After nearly a decade of being a major force in the crypto world, ETH has seen a sharp decline in 2025\u2014its price falling by around 46% in the first quarter. Ethereum\u2019s transaction fees have dropped to their lowest point since<\/p>\n","protected":false},"author":1,"featured_media":839370,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[25740,4759],"tags":[],"class_list":["post-839369","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ethereum","category-price"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/839369","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=839369"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/839369\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/839370"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=839369"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=839369"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=839369"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}