Ethereum (ETH) has long been a cornerstone of the cryptocurrency market, second only to Bitcoin in prominence and ecosystem influence. However, as of April 2025, ETH has struggled to regain momentum, dropping as low as $1,400 before rebounding slightly above $1,700. While this resilience suggests some underlying strength, Ethereum’s performance has lagged behind other major altcoins—such as Solana, Tron, and BNB—by nearly 23% year-to-date. With repeated price rebounds followed by new lows, many investors are asking: Is Ethereum still worth holding or investing in?
This article dives into on-chain data, network fundamentals, technical indicators, historical trends, and competitive pressures to assess Ethereum’s current position and future potential.
Ethereum’s Long-Term Holder Inflows Hit Record High
One of the most compelling signs of confidence in Ethereum emerged in April 2025. According to CryptoQuant, long-term holder addresses saw a record single-day inflow of 449,000 ETH on April 22, with an average acquisition price around $1,750. This is the largest daily accumulation ever recorded, indicating strong conviction among whales and institutional-grade investors.
Despite this bullish signal, the current market price remains below the realized price—the average cost basis of all existing ETH—of $1,981. This means the majority of holders are currently underwater. More notably, for the first time since 2018, Ethereum’s realized price has exceeded its market price, reflecting a shift in holder composition toward longer-term, value-oriented investors.
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Concurrently, network participation is rising. Active Ethereum addresses grew by 10% between April 20 and April 22—from 306,211 to 336,366—suggesting increased usage and engagement despite bearish price action. These metrics point to a growing belief that Ethereum’s fundamentals remain strong even during periods of price stagnation.
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Weak DeFi Activity Fuels Inflationary Pressure on ETH
While on-chain accumulation is encouraging, decentralized finance (DeFi) activity on Ethereum paints a less optimistic picture. Data from DefiLlama shows that trading volume on Ethereum-based decentralized exchanges (DEXs) has declined steadily, averaging just over 1.3 million weekly transactions with little sign of growth.
This stagnation is concerning given Ethereum’s status as the leading DeFi ecosystem. Reduced user activity translates directly into weaker demand for ETH, especially since transaction fees—historically a key deflationary mechanism—are no longer sufficient to counteract new supply from staking rewards.
Since January 2025, Ethereum’s fee revenue has dropped by 95%, undermining the effectiveness of EIP-1559’s burn mechanism. As a result, net issuance of ETH has turned positive, creating inflationary pressure that erodes scarcity—a critical factor for long-term value appreciation.
Without a resurgence in DeFi usage or meaningful protocol-level upgrades to boost fee generation, Ethereum may struggle to support sustained price increases.
Technical Outlook: Key Resistance Levels Ahead
From a technical perspective, Ethereum faces several critical resistance levels that could determine its near-term trajectory.
The Cost Basis Distribution (CBD) heatmap reveals that approximately 1.64 million ETH were purchased at $1,895.50 in November 2024. This zone represents a significant psychological and structural barrier. If ETH approaches this level, profit-taking by recovering investors could trigger selling pressure and stall upward momentum.
Additionally, ETH is currently trading near its 50-day exponential moving average (EMA) on the daily chart—a key indicator for trend reversals. A sustained close above the 50 EMA would signal potential bullish momentum. More importantly, breaking above $1,895** and then clearing **$2,142 in daily closing prices could invalidate the current downtrend and open the door for a broader recovery.
However, some analysts warn of bearish patterns forming. Trader Rektproof has noted similarities between current price action and historical setups that preceded sharp declines. If broader market sentiment sours, ETH could retest the $1,400 support level—or even break below it.
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Historical Precedents: Can Ethereum Sustain Momentum?
History offers cautionary lessons for Ethereum investors. Past rallies have often been followed by steep corrections:
- In June 2022, ETH fell below $1,100 as its dominance in the altcoin market dropped to 26.5%. It quickly rebounded to $2,000 but collapsed back under $1,200 within three months.
- A similar pattern occurred in April 2021: ETH surged from $2,100 to $4,200 in weeks, only to fall back below $2,000 within a month.
These episodes highlight a recurring cycle: rapid price appreciation leads to aggressive profit-taking, limiting Ethereum’s ability to establish durable upward trends. This behavior reduces the likelihood of achieving new all-time highs in the short term and contributes to investor skepticism.
While Ethereum remains technologically robust, its price dynamics reflect a mature asset vulnerable to sentiment swings and macroeconomic factors such as interest rates and regulatory uncertainty.
Competitive Landscape and ETF Impact
Ethereum continues to lead in total value locked (TVL) across blockchains, underscoring its dominance in DeFi and staking ecosystems. Yet this advantage hasn’t translated into stronger price performance or higher network utilization.
Meanwhile, competing platforms like Solana and XRP are gaining traction due to growing speculation around potential spot ETF approvals in the U.S. Although only Bitcoin and Ethereum currently have approved spot ETFs, any expansion to other assets could divert institutional capital away from ETH.
Notably, U.S.-listed Ethereum spot ETFs experienced a $10 million net outflow between April 21 and 23, while Bitcoin ETFs saw record inflows during the same period. This divergence highlights ETH’s relative weakness in attracting institutional demand amid a risk-off environment.
Frequently Asked Questions (FAQ)
Q: Is Ethereum still a good long-term investment?
A: Yes—for investors with a multi-year horizon. Despite short-term headwinds, Ethereum’s robust developer community, leading DeFi ecosystem, and ongoing scalability upgrades (like Proto-Danksharding) support its long-term viability.
Q: Why isn’t ETH price rising despite strong fundamentals?
A: Price lags can occur when usage growth doesn’t translate into direct token demand. With low transaction fees and weak DeFi volume, there's limited immediate economic pressure to buy ETH—despite healthy network infrastructure.
Q: Could ETH reach new highs in 2025?
A: Possible—but unlikely without a major catalyst such as a Fed rate cut, surge in Layer-2 adoption, or approval of additional crypto ETFs driving broader market optimism.
Q: What happens if Ethereum ETFs continue seeing outflows?
A: Persistent outflows may signal weakening institutional confidence and could weigh on price unless offset by strong retail demand or on-chain improvements.
Q: How does staking affect ETH supply and price?
A: Staking locks up supply (currently over 30% of total ETH), which is deflationary. However, new issuance for staking rewards offsets burns from EIP-1559—especially when fees are low—leading to net inflation in bear markets.
Final Verdict: Proceed with Caution
Ethereum remains a foundational pillar of the crypto economy. Its record-breaking long-term holder accumulation and resilient network activity suggest enduring confidence in its future.
Yet real challenges persist: weak DeFi engagement, declining fee income, historical volatility patterns, and increasing competition. These factors make a strong near-term breakout uncertain.
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For traders, key levels at $1,895** and **$2,142 will be crucial for confirming trend direction. Long-term holders should focus on ecosystem developments rather than price alone.
In summary: Ethereum isn’t broken—but it’s not breaking out yet either. In today’s environment, informed caution beats blind optimism.