Ethereum fundamentals show signs of recovery: ETH trading hits new highs, Gas fees remain low

Recent developments in on-chain data are remarkable. Ethereum not only demonstrates a strong recovery in usage demand but, more importantly, this growth is accompanied by rational cost control. These signals collectively point to a conclusion: Ethereum’s fundamentals are undergoing a genuine transformation. Over the past year, on-chain activity for Ethereum has experienced fluctuations, but since the end of the year, the situation has significantly improved. Transaction volume has increased while transaction fees remain at affordable levels, reflecting a fundamental enhancement in the efficiency of this blockchain network.

The Art of Balancing Transaction Activity and Gas Fees

On-chain data shows that the number of daily transactions on Ethereum recently surpassed 2.885 million, setting a new record. This figure alone is enough to demonstrate the strong market demand for Ethereum usage, but more notably, amidst this volume of transactions, Ethereum’s Gas fees (transaction fees) remain low, far from the fee spikes seen during previous bull markets.

This phenomenon is quite rare in Ethereum’s development history. In past years, whenever on-chain transaction activity heated up, Gas fees would often surge, creating a vicious cycle of high user costs and network congestion. However, today, Ethereum has successfully broken this cycle. The key behind this success is the increasing maturity of Layer 2 scaling solutions, which effectively divert a large volume of transactions, allowing the mainnet to handle high demand while maintaining rational transaction costs. A smoother, more efficient traffic distribution mechanism has elevated the overall network efficiency of Ethereum to a new level.

Staking Queues and Investor Confidence Remain Strong

Alongside the prosperity at the transaction layer, the staking ecosystem on Ethereum is also showing steady improvement. Data indicates that the “exit queue” for Ethereum validators has dropped to zero, meaning that any investor wishing to unstake and withdraw ETH can now do so with the convenience of “withdraw anytime,” without long waiting periods.

This shift itself sends a strong signal of market confidence. In stark contrast, the queue of those eager to stake remains long. According to statistics, over 36 million ETH are currently locked in staking contracts, accounting for about 30% of the circulating supply; meanwhile, more than 2.5 million ETH are queued to participate in staking, the highest since August 2023. This data confirms that the market is not experiencing panic withdrawals but rather demonstrates holders’ confidence in long-term asset locking.

From Burn Narrative to Settlement Value: Ethereum’s Role Transformation

High transaction volume, low fees, and the temporary pause in staking withdrawals—these three phenomena together are undoubtedly a major victory for user experience. However, they also foreshadow a deeper transformation in Ethereum’s narrative framework.

In the past, the market was accustomed to the “fee surge → massive burning → supply scarcity” deflationary narrative, which was a key logic driving ETH’s value perception. But as 2026 approaches, this simple narrative relying solely on fee surges will gradually fade. Instead, Ethereum’s true application value as a “global settlement layer” will come to the forefront—it no longer needs to rely on high costs to highlight its scarcity but will instead demonstrate its irreplaceability through actual network usage, transaction prosperity, and ecological applications. This is the essence of Ethereum’s fundamental recovery.