2-4-2025 – Ethereum’s market performance has taken a rather dramatic downturn, casting a shadow over its prospects. The digital currency, which had briefly flirted with the $1,927 mark on Tuesday, has since retreated substantially, leaving investors to ponder its immediate future.
The cryptocurrency’s financial health has been particularly rattled by an unprecedented plunge in revenue streams from its layer-2 scaling operations. Most notably, the blockchain’s blob fee earnings have hit rock bottom, marking their lowest point this year. The figures paint a stark picture: a mere 3.18 ETH was generated in the week concluding 30th March, representing a startling 73% week-on-week decline.
At the heart of this revenue crisis lies the recent Dencun upgrade, implemented in March 2024. Whilst this technical enhancement was designed to benefit users through cost reductions, it has inadvertently triggered a substantial decline in Ethereum’s income streams. Asset management firm VanEck’s analysis suggests the protocol could face a staggering 95% reduction in revenue.
The market’s response has been decidedly bearish, with technical indicators suggesting mounting pressure on key support levels. March proved particularly challenging, as Ethereum witnessed its market capitalisation shrink by a substantial 45%. The cryptocurrency’s recent trading pattern has exhibited notable weakness, despite occasional upward movements.
The confluence of dwindling revenues and technical market pressures has created a perfect storm for Ethereum. Should the current support level fail to hold, market analysts suggest the possibility of a retreat to earlier support zones, potentially testing the resolve of long-term investors.
