In March, Ethereum regained its position as the leading platform for decentralized exchange trading volume, marking its first return to the top since September 2024.
According to data from DefiLlama, Ethereum-based DEXs facilitated $64 billion in spot trading volume, exceeding Solana’s $52 billion and BSC’s $44 billion. Despite this achievement, overall market activity has shown signs of stagnation. DEX trading volume decreased from $86 billion in January to $85 billion in March, while the total value locked plummeted from $67 billion to $49 billion during the same timeframe.
The income generated by network fees has also seen a significant drop. In January, Ethereum (ETH) generated $142 million in transaction fees, but this figure nosedived to just $21 million by March. Notably, the network’s burn rate, which indicates the amount of ETH being permanently removed from circulation, recently hit its lowest point since August 2021.
Data from Ultrasound Money shows that only 53 ETH were burned each day last week, and Ethereum’s total supply has increased by 3% since the implementation of the EIP-1559 upgrade. This raises concerns regarding the long-term value retention of the asset.
As a consequence, Ethereum’s price has faced challenges, closing Q1 2025 down 45%, as reported by Coinglass. This decline has resulted in the loss of $170 billion in market value—marking it as the network’s third-largest downturn since 2016.
With the current dynamics, institutional investors have shown apprehension. Data from SoSoValue indicates that Ethereum exchange-traded funds experienced a loss of $403 million in March, with only a single day of incoming investments. Moreover, analysts at Standard Chartered have reduced their year-end ETH price prediction from $10,000 to $4,000, citing fierce competition from Ethereum’s layer-2 solutions, which are attracting users with lower fees.
Nevertheless, Ethereum’s long-term prospects remain promising. It continues to lead in key areas like the tokenization of real-world assets, an industry expected to reach $16 trillion by 2030.
As reported by RWA.xyz, Ethereum accounts for 54% of the tokenization market, with $5 billion in assets tokenized on its platform. As traditional finance increasingly adopts on-chain solutions, the network may witness a resurgence of interest.
Larry Fink, CEO of BlackRock, has highlighted the potential of tokenization, forecasting that all assets will eventually be represented on the blockchain. Should Ethereum manage to maintain its pivotal role in this transition, its supply may turn deflationary once again, potentially enhancing its long-term value.
Additionally, Ethereum might gain from the introduction of staking-enabled Ethereum ETFs, as both the New York Stock Exchange and the Chicago Board Options Exchange have submitted proposals for this to the Securities and Exchange Commission.
Staking within ETFs could significantly increase demand and lock away a considerable amount of ETH. Combined with rising institutional adoption, this could provide Ethereum with a much-needed uplift.