The Ethereum blockchain recorded its strongest operational yr in historical past in 2025, processing document transaction volumes and securing the overwhelming majority of the DeFi market.
Nevertheless, the crypto asset that powers the community didn’t mirror that progress, posting double-digit losses for the yr.
In accordance with CryptoSlate’s information, ETH is buying and selling down 10% year-to-date at underneath $3000. Its efficiency in opposition to Bitcoin, the flagship digital asset, has additionally lagged, with the ETH/BTC ratio falling 6% for the reason that begin of the yr.
This divergence highlights a basic shift within the economics of the world’s most generally used industrial blockchain.
Whereas community utility has soared, technical upgrades designed to decrease prices for customers have considerably lowered the income flowing to the core community, decoupling the worth of Ether from the exercise on its rails.
The $100 million loss
One of the important consider Ethereum’s monetary profile this yr was the collapse of “lease” paid by Layer-2 networks.
These networks, which bundle transactions collectively to avoid wasting prices earlier than settling them on the principle Ethereum blockchain, beforehand served as a significant supply of price income.
In 2024, Layer-2 networks generated $277 million in whole income. Of that quantity, they paid roughly $113 million—or 41%—to the Ethereum mainnet to course of information and safe the community.
In 2025, that income mannequin inverted. In accordance with Growthepie information, the full income for Layer-2 networks fell 53% to $129.17 million as charges have been lowered for finish customers.
Nevertheless, the fee paid to the Ethereum mainnet plummeted even additional. Layer-2 networks paid round $10 million to Ethereum for safety in 2025, representing lower than 10% of their whole income.
The remaining $119 million was retained as revenue by the Layer-2 operators.
Successfully, this meant Ethereum sacrificed greater than $100 million in assured price income this yr to safe its long-term survival.
This decline stems from the “Dencun” improve carried out final yr. The replace efficiently lowered transaction charges, successfully subsidizing the ecosystem’s progress by decreasing the revenue Ethereum collects from the “Layer-2” networks constructed on prime of it.
This allowed the community to course of greater volumes of site visitors with out clogging the principle blockchain or spiking charges.
Whereas the technical implementation succeeded in making Ethereum cheaper and sooner, it eliminated a key driver of demand for the ETH token.
In earlier years, excessive community utilization resulted in excessive charges, a portion of which have been “burned” thereby decreasing provide and supporting the worth.
With charges hitting document lows in 2025, the deflationary strain on the token provide has weakened considerably. Consequently, Ethereum’s inflation fee has elevated by 0.204% for the reason that merge occasion in September 2022.
Coinbase community dominates revenue share
The rearrangement of Ethereum’s economics has created a consolidated marketplace for scaling options, with one dominant participant capturing nearly all of the sector’s earnings.
Base, the Layer-2 community developed by the publicly traded US change Coinbase, generated greater than $75 million in income in 2025. This determine represents almost 60% of your complete Layer-2 sector’s income for the yr.
Base’s monetary efficiency far outpaced its decentralized rivals. Arbitrum, which held a big market lead in prior years, generated roughly $25 million in income, taking second place.
Different opponents noticed decrease values. The Polygon community generated $5 million in income, whereas Consensys-backed Linea introduced in $3.94 million. Optimism, one other early chief within the scaling sector, earned roughly $3.83 million.
This focus of income marks a departure from 2024, when the market was extra evenly distributed. Within the earlier yr, Arbitrum generated $42 million, Linea generated $36.6 million, and Scroll generated $35 million.
The rise of Base means that distribution channels and consumer expertise have turn into the deciding components within the scaling wars.
By integrating the community immediately into its change merchandise, Coinbase has efficiently funneled retail exercise onto its personal rails.
Consequently, a good portion of the worth generated by the Ethereum ecosystem now accrues to the stability sheet of a definite company entity quite than the broader community members.
Market share hits multi-year excessive
Regardless of ETH’s worth efficiency, institutional adoption of the Ethereum community continues to be accelerating.
Obtainable information signifies that buyers aren’t leaving the ecosystem for sooner or cheaper various blockchains, a pattern that outlined the 2022 bear market.
For context, Ethereum’s dominance of the DeFi sector expanded all through 2024 and 2025. The blockchain community’s mainnet now secures roughly 64% of the full worth locked (TVL) in DeFi functions, up from a cycle low of roughly 45% in 2022.
Leon Waidmann, the pinnacle of analysis at Onchain HQ, posited that the Ethereum ecosystem’s market share rises above 70% when belongings held on Layer-2 networks like Base, Arbitrum, and Optimism, are included.
This consolidation suggests a “flight to high quality” amongst giant capital allocators.
Because the trade matures, establishments are prioritizing Ethereum’s safety and authorized readability over the speculative upside of newer, extra risky blockchains.
The community has successfully turn into the settlement layer for the trade, whilst the particular mechanism for capturing worth from that exercise stays underneath strain.
On the identical time, analysts notice that the ecosystem’s stability stands in distinction to earlier market cycles.
Transaction volumes are accelerating into the year-end with out the “blow-off prime” hypothesis sometimes seen throughout peaks, suggesting the expansion is pushed by basic utilization quite than short-term buying and selling frenzies.
Buyers weigh utility in opposition to worth
Nonetheless, the widening hole between Ethereum’s operational success and its market valuation presents a fancy outlook for buyers heading into 2026.
The ten% year-to-date decline in ETH’s worth displays uncertainty concerning the token’s position on this new low-fee setting.
With the mainnet successfully subsidizing the Layer-2 networks, the direct correlation between elevated transaction quantity and elevated token worth has been disrupted.
Market observers level out that whereas the ecosystem is more healthy than ever, the monetary advantages are presently siloed within the software and scaling layers.
Nevertheless, the community supporters argue that it is a vital transition section. They argue that Ethereum has secured its place as the worldwide normal for blockchain settlement by decreasing prices and growing capability.
In accordance with them, this moat that can finally drive long-term worth to the token with BitMine Chair Tom Lee believing the asset might rise above $5000 subsequent yr.