Recently, discussions in the market about Ethereum mainly revolve around the following directions, which include both shifts in macro narratives and impacts from specific technological upgrades.
· New narratives from Wall Street and regulators
· Core viewpoint: Some analysts believe that a new chain is forming in the capital network between Wall Street and Washington: U.S. political and economic elites → U.S. Treasury bonds → Stablecoins/Crypto vaults → Ethereum + RWA (real-world assets) + L2. Recent statements by the chairman of the SEC regarding the potential migration of the entire U.S. financial market to the blockchain in the coming years have strengthened this expectation.
· Impact Interpretation: This is seen as a powerful structural bullish narrative, where assets of the traditional financial system (such as US Treasuries) are tokenized, potentially consolidating on Ethereum and its Layer 2 networks, bringing significant value support.
· Fusaka Upgrade and Deflation Expectations
· Core Changes: The recent Fusaka upgrade for Ethereum aims to address the problem of L2 prosperity but insufficient value capture on L1. The upgrade enforces that L2 activities must pay a minimum fee for data, which will be burned.
· Key Data: After the upgrade, Blob fees have become the largest contributor to ETH burning, accounting for as high as 98%, with daily burns exceeding 1500 ETH. If L2 activity continues to grow, ETH may return to a deflationary state.
· Market Structure and Technical Signals
· Position Changes: Market data shows that the current ETH stock on exchanges is at a historical low, accounting for only about 10% of the total, indicating that potential selling pressure is relatively small.
· Market Sentiment: After experiencing a market downturn, the speculative leverage in the entire crypto market has dropped to historically low levels (around 4%), indicating that market panic has been sufficiently released. At the same time, the ETH/BTC exchange rate has shown a sideways resistance trend since November, and the previously effective 'long BTC/short ETH' pairing trading strategy has recently failed.
· Core Logic: It is believed that the active growth of the current Ethereum Layer 2 network (L2) has an unclear effect on the value transmission to the main chain. At the same time, although there has been inflow into ETH ETFs, their scale and influence may be limited.
In summary, the current market sentiment towards Ethereum shows a complex but generally optimistic trend:
· The bullish logic is primarily based on the grand narrative of 'traditional finance on-chain,' value capture from technological upgrades and deflation models, as well as the healthy structure after market leverage has been cleared.
· Bearish or cautious views mainly focus on the need to verify the substantial value contribution of L2 growth to the mainnet, as well as the continuity of ETF fund inflows.
