Happy New Year to everyone returning to work! Suddenly wanted to discuss the expectations for 2026.

And one question we all might have: why has the ETH ecosystem grown larger over the past four years, yet the price seems to be 'stuck' below $5,000?

1. Institutions' view of ETH in 2026

First, let's take a look at the price predictions for 2026 given by mainstream institutions.

Standard Chartered: Predicting $7,500 - $8,000. The reason is the dominance of smart contracts in gaming and RWA (Real World Assets tokenization).

VanEck: Trend analysis $10,000+. They believe ETH is the king of the application layer, and the ETF will have a long tail effect.

Arthur Hayes: even shouted to $20,000.

It indeed looks very impressive. According to this script, what we hold is the digital oil of the future.

But as long as those who experienced the 2021-2025 cycle are veterans, they will all have the same thought:

'ETH has not broken $5000 in the past four years, everyone's prediction logic is similar each year, but the result is the same every year.'

Why has $BTC repeatedly hit new highs, while ETH seems like a sleeping giant?

Two, Internal Contradictions: Ethereum is being drained by its own 'children'

Looking back over the past four years, the core reason why ETH cannot break through its previous high is the dramatic change in the business model, leading to the failure of the original 'deflationary logic'.

The logic of 2021 (deflationary): Everyone is trading on the mainnet -> Gas fees are expensive -> A large amount of ETH is burned -> Coin prices rise.

The current situation in 2025 (inflation): In order to expand capacity, Ethereum fully supports Layer 2 (Arbitrum, Base, Optimism). Especially after the Cancun upgrade, the 'rent' paid by L2 to the mainnet has decreased by more than 90%.

The result is:

1. Users and activity have moved to L2 (this is a good thing, the ecosystem has prospered).

2. However, the mainnet can no longer collect tolls! Gas fees remain in single digits for a long time, ETH's destruction volume has plummeted, changing from 'deflation' back to 'inflation'.

In simple terms, Ethereum has transferred all profits to L2, resulting in the mainnet lacking value capture capability. This is why the ecosystem is rising, but your ETH is not.

Three, Macro Truth: Overcapacity in infrastructure, barren applications

In addition to internal factors, there is also a more fundamental external factor.

Just yesterday, CZ tweeted:

"Crypto market is tiny. The technology potential is huge, all unrealized. Just the beginning."
(The crypto market is still very small. The technological potential is huge, but it has yet to be realized. Everything is just beginning.)

This sentence directly points out the core pain point preventing ETH and the entire altcoin market from rising:

We have too many roads (L1/L2), but almost no cars (applications) running on them.

  • Technical potential Unrealized: In our current ETH ecosystem, apart from issuing tokens (Meme), lending (DeFi), and the non-interoperable L2 islands, is there any application that outsiders must use? Almost none.

  • Too few applications cannot support high valuations: ETH is a resource similar to 'oil'. If there is no large-scale industry (applications) to consume oil, relying solely on a group of people trading oil futures, how can the price possibly break $5,000 long-term?

So the current situation is that the houses (infrastructure) are becoming more luxurious, but there are no residents (real application scenarios), still an empty city. Without large-scale incremental applications landing, ETH can only compete in the existing market.

Four, The Key to Breaking the Deadlock in 2026: A Must Change the Way of Living

If we want to break the 'magic curse of 5000 dollars' in 2026, relying on old stories (ultrasound currency, deflation) can no longer hold water; two variables must reverse:

Shifting from 'road construction' to 'sports cars': no longer blindly believing in how fast TPS is, but rather looking for a killer application (GameFi 2.0 or SocialFi) that can bring millions of daily active users, truly burning off ETH's inventory. As CZ said, turning 'Unrealized' into 'Realized'.

Reclaiming military power: forcing L2 to 'hand over' a portion of the ranking power and profits to the mainnet, allowing the prosperity of Base or Arbitrum to directly benefit ETH's price.

Five, Summary and Views

Regarding the prediction of $8,000 or even $10,000 for 2026, my advice is: stay neutral, don't FOMO.

The current ETH is stuck between two cycles: the pain period of L2 draining and the window period before killer applications explode.

If you believe CZ's words 'Just the beginning', and believe that there will be a massive number of applications running on Ethereum in the future, then the current range of $3,000 - $4,000 is an undervalued 'golden pit'.

But if in the next two years there are still only Memes and schemes, without actual applications landing, then ETH will still find it difficult to break the $5,000 ceiling.

2026 is the decisive year for Ethereum to move from 'speculative concept' to 'real applications'. Only when applications explode can the price explode.