Nansen, the blockchain analytics platform, issued a research note this week arguing that Ethereum's persistent weakness can't be blamed solely on macroeconomic pressure. The firm says the second-largest crypto asset has deeper, more structural problems.
Beyond the macro
Most market commentary has pinned Ethereum's lagging price on interest rate fears or regulatory uncertainty. Nansen disagrees. In the note, its analysts argue that while macro conditions matter, they don't explain why Ethereum has underperformed peers like Solana or Bitcoin over recent months. The firm sees trouble inside the network itself.
What Nansen sees
The research team pointed to a steady decline in on-chain activity—fewer active addresses, lower transaction counts, and a shrinking fee market—as evidence that demand for Ethereum blockspace is fading. They also flagged the ongoing migration of users and liquidity to Layer 2 networks, which may be cannibalizing the base layer more than expected. That shift, they say, isn't a temporary blip; it reflects a longer-term change in how people use Ethereum.
If Nansen is right, a simple interest rate cut or a regulatory win won't be enough to revive ETH. The network needs to solve its own demand problem—whether through new applications, better incentives for Layer 1 activity, or some other catalyst. The note doesn't offer a timeline, but it suggests that the path to recovery starts with fixing what's inside, not hoping for outside relief.
The full report is available to Nansen subscribers.
