Ether’s weekend slide at the end of February revived a familiar question: is the Ethereum network falling behind newer competitors or struggling to justify its valuation?
As ETH fell by as much as 17% along with most crypto, skeptics wondered if this was a warning sign that the protocol’s dominance may be eroding.
But inside the Ethereum ecosystem, the sell-off has not been met with the same alarm. Developers and long-term players largely framed the move as a market-driven correction rather than a verdict on Ethereum’s health.
By several measures, network activity remains near peak levels. “Ethereum TVL is actually near all-time highs when denominated in ETH,” said Sam Ruskin, an analyst at Messari, suggesting that capital has not meaningfully fled the ecosystem even as the token’s dollar price fell.
Other indicators point in the same direction. The access queue for ETH stakes — the wait validators face to help secure the network — has stretched to about 70 days, a signal that demand to commit capital to Ethereum, especially among large institutions, remains strong despite short-term volatility.
That resilience is also evident across decentralized finance, where activity has stopped, even though prices have soured. Traders and users are still engaging with onchain applications in search of profits, a sign that usage has not evaporated along with sentiment.
“We’re still growing and getting more users and revenue, but the token price is lagging,” Mike Silagadze, CEO of ether.fi, one of the largest restaking networks, told CoinDesk over Telegram. “We only focus on the long run.”
Some market observers claim that the price movement itself is being over-interpreted. Marcin Kazmierczak, CEO of blockchain data firm RedStone, said ether’s decline looks more like market noise than a signal of weakening fundamentals, especially as retail activity fades. What matters more, he said, is a level of institutional conviction around onchain financing that he hasn’t seen before.
“The absence of retail tension is actually refreshing – the next cycle will be driven by real adoption, not memes, and that allows builders to focus on creating long-term value,” Kazmierczak added.
This disconnect between price action and progress on the ground is a familiar pattern in Ethereum history. Periods of market turbulence have often coincided with some of the network’s most consistent development milestones, as builders continue to broadcast regardless of short-term sentiment.
“As we’ve seen with the merger, the market is pretty bad at pricing the fundamental technical realities of the chains,” said Marius Van Der Wijden, a core developer at the Ethereum Foundation, noting that major technical changes are often not fully reflected in prices until well after they’re completed.
For some analysts, the divergence between price and onchain data reflects broader market dynamics rather than Ethereum-specific weakness. Ruskin said the network “looks as healthy as it ever has,” and argued that ETH’s recent decline is more closely tied to bitcoin’s movements or broader market sentiment than to any deterioration in Ethereum’s fundamentals.
Read more: DeFi’s quiet strength: Value locked in platforms holds as market sell-off tests traders
