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Ethereum (ETH) Performance Improves Despite Year-to-Date Decline
Total Value Locked (TVL) on Ethereum Network Rises
Ethereum (ETH) has underperformed year-to-date, declining over 20%. However, fundamentals are improving, and total value locked (TVL) on the Ethereum blockchain has risen dramatically, according to a research report by Wall Street bank Citi.
Fundamental Backdrop Not All Murky
While user activity has been volatile in recent weeks, the fundamental backdrop is not all that murky, analysts led by Alex Saunders wrote.
TVL on Ethereum Network Rises Sharply
Citi noted that TVL on the Ethereum network has risen sharply, while ether exchange-traded funds (ETFs) are still seeing inflows, and search interest is rising.
Ethereum ETF Flows Turn Positive
Following the U.S. election in November, ether ETF flows turned positive, with total inflows of $3.2 billion since their July launch.
Stronger User Growth on Layer-2s and Rival Blockchains
Stronger user growth on layer-2s and rival blockchains, such as Solana, has raised questions about Ethereum’s competitive advantage, the report said.
President Trump’s World Liberty Financial Holds Over $200 Million in Ether
President Trump’s World Liberty Financial holds more than $200 million of ether, and this could be viewed as “additional motivation for ensuring the U.S. strengthens its support for the crypto industry,” the bank said.
Relative ETH and Altcoin Performance May Indicate Industry Optimism
“Relative ETH and altcoin performance may serve as a gauge for how optimistic the industry is regarding follow-through on regulatory clarity in the U.S.,” the report added.
Weakness in Ether Coincides with Increase in Bitcoin Dominance
Citi noted that weakness in ether has coincided with an increase in bitcoin (BTC) dominance, which is now at multi-year highs above 60%.
Conclusion
In conclusion, despite Ethereum’s year-to-date decline, the fundamentals are improving, with TVL on the Ethereum network rising sharply. The report by Citi highlights the resilience of the Ethereum network and its potential for growth.
FAQs
Q: What is the current state of Ethereum (ETH)?
A: Ethereum (ETH) has underperformed year-to-date, declining over 20%.
Q: What is the current state of TVL on the Ethereum network?
A: TVL on the Ethereum network has risen sharply.
Q: What are the implications of President Trump’s World Liberty Financial holding over $200 million in ether?
A: This could be viewed as “additional motivation for ensuring the U.S. strengthens its support for the crypto industry.”
Q: What is the current state of bitcoin (BTC) dominance?
A: Bitcoin (BTC) dominance is now at multi-year highs above 60%.
Q: What is the relationship between the performance of ETH and altcoins?
A: Relative ETH and altcoin performance may serve as a gauge for how optimistic the industry is regarding follow-through on regulatory clarity in the U.S.
