Institutional interest and technical scaling milestones drive network utility despite broader market consolidation.
LONDON | December 25, 2025 — The Ethereum network recorded a peak in Layer 1 (L1) utility this month, processing a record 1.91 million daily transactions following the successful activation of the Fusaka upgrade.
Data reviewed by this publication shows the uptick in activity coincides with a reduction in average transaction fees to $0.16, a result of protocol refinements designed to increase block capacity by approximately 33%. Market participants said the performance parity with high-throughput systems is beginning to alter the long-term thesis for the asset among corporate treasuries.
Institutional accumulation has notably tightened the liquid supply. Industry sources noted that the top three corporate holders now control approximately 4.5 million ETH, while exchange balances have retreated to historic lows of roughly 8.7% of total supply. This contraction in available liquidity comes as funds in London and New York adjust exposure amid shifting interest rate expectations and regulatory developments in the US and Europe.
Market context:
Liquidity remained concentrated in large-cap digital assets during the session, with Ether maintaining support near the $3,000 level despite mixed spot ETF flows.
The technical roadmap for the protocol has moved into a more deliberate phase. Analysts in Singapore said the transition from the Pectra upgrade in May to the recent Fusaka implementation has effectively doubled blob capacity, supporting a maturing Layer 2 ecosystem. Total Value Locked (TVL) in Ethereum-based DeFi remains dominant, holding above $70 billion, significantly outpacing competing Layer 1 platforms.
Regulatory clarity has also provided a framework for expanded institutional use cases. Market participants said the rollout of the EU’s MiCA framework and stablecoin-specific legislation in Asia has accelerated the use of the network for real-world asset (RWA) tokenization. Global policy reviews show that over 70% of jurisdictions advanced stablecoin regulations in 2025, positioning Ethereum as a primary settlement layer for tokenized treasuries and private credit.
Traders in New York observed that while price action remains range-bound, the underlying network economics are shifting. The staking participation rate has climbed as institutional-grade custody solutions become more integrated with traditional financial rails. This has transformed Ether into a productive asset for many large-scale holders, providing a native yield that currently competes with traditional fixed-income instruments on a risk-adjusted basis.
Looking ahead, the Ethereum Foundation has confirmed the “Glamsterdam” and “Hegota” upgrades for 2026. These updates are expected to address “state growth” and “maximum extractable value” (MEV), technical hurdles that have historically complicated long-term decentralization. Industry sources noted these changes are essential for maintaining the protocol’s institutional appeal as a neutral settlement layer.
Despite the technical progress, the ecosystem continues to face fragmentation. Market participants noted that while Layer 2 solutions have lowered costs, the user experience remains split across multiple networks. Developers are currently prioritizing cross-chain interoperability standards to address these bottlenecks as the network moves toward a target of 100,000 transactions per second in the coming years.
Global Markets Desk | DECODE THE CRYPTO
Global Markets Desk covers global cryptocurrencies, regulation, and digital finance with an institutional and macroeconomic focus.
Disclaimer: Crypto assets are volatile and involve risk. This content is published for informational purposes only.
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