Ethereum's Struggles: Price Falls, Stagnation & Rise of Layer-2 Solutions

Ethereum's Performance: A Mixed Bag

According to Cointelegraph, Ethereum (ETH) has underperformed Bitcoin (BTC) for 85% of all trading days since its launch in 2015. The ETH/BTC ratio recently hit a five-year low of 0.018, a level not seen since December 2019. Ethereum's price has dropped to $1,400, erasing gains from the past seven years. Analysts suggest that the asset is nearing oversold levels, with a potential bottom around $1,000.

Concerns about Ethereum's stagnation have been raised, with Web3 researcher Stacy Muur noting that the number of active addresses on the network has remained static for four years. However, layer-2 scaling solutions have seen significant growth, indicating a shift in activity. Despite the downturn, technical indicators suggest a possible recovery in the near future.

"Ethereum has had [around] the same number of active addresses for the past 4 years." - Stacy Muur

Key Takeaways:

ETH/BTC ratio at a five-year low of 0.018.
Ethereum price dropped to $1,400, nearing oversold levels.
Layer-2 networks show growth despite mainnet stagnation.

Aavegotchi's Migration to Base

Decrypt reports that the Ethereum-based game Aavegotchi is migrating from Polygon to Coinbase's Base network following a community vote. The move will also result in the shutdown of Aavegotchi's layer-3 network, Geist. The migration is expected to take 4-6 weeks, during which all existing NFT assets will be cloned and re-minted on Base.

The decision was influenced by declining gaming traction on Polygon and the high costs of maintaining a layer-3 network. Aavegotchi's GHST token has seen a 28% decline over the past week, reflecting broader market volatility. The migration aims to streamline operations and improve user experience.

Key Takeaways:

Aavegotchi is moving from Polygon to Base network.
Geist layer-3 network will be shut down.
Migration to take 4-6 weeks, with assets re-minted on Base.

Ethereum's DEX Volume Decline

The Block highlights a significant drop in Ethereum's decentralized exchange (DEX) volume, which has halved since its December 2024 peak. Daily unique traders have decreased to approximately 40,000, a 12-month low. Uniswap remains the dominant DEX, but newer platforms and layer-2 solutions like Base are capturing market share.

Despite the decline, DEXs still account for 13% of total spot trading volume, showing a gradual upward trend. Innovations in DEX aggregators and cost-efficient alternatives are helping to offset Ethereum's volume reduction.

Key Takeaways:

Ethereum's DEX volume fell to $57 billion in March 2025.
Daily unique traders dropped to 40,000, a 12-month low.
Layer-2 solutions like Base are gaining traction.

Ethereum Network Fees at a Four-Year Low

Bitcoinist reports that Ethereum's transaction fees have dropped to their lowest level since 2020, reflecting reduced demand for block space. The fees decreased by 60% in Q1 2025, totaling $208 million by April 4. Layer-2 solutions and updates like Dencun have contributed to this decline by lowering scaling costs.

Ethereum's price has also suffered, falling by 45% in Q1 2025. Analysts suggest that the next major support level is $1,290, with a potential bottom around $870 if the decline continues.

Key Takeaways: