Currently, Ethereum stands at a critical historical turning point — no longer the star asset once hailed as 'supersonic currency', but more like a veteran repeatedly battered by reality and structural challenges. The network usage has sharply declined, main chain transaction fees have hit a new low, and even Vitalik himself is starting to consider 'major surgery', replacing the EVM architecture that has supported the Ethereum ecosystem for years with a brand new RISC-V system. Some say this is an upgrade; others call it 'surrender'.
One, institutions 'cool treatment': Galaxy and Paradigm begin to reduce positions
On-chain data does not lie. Long-term Ethereum supporters like Galaxy Digital transferred 65,600 ETH to Binance in mid-April, worth over $100 million. Meanwhile, Paradigm quietly sent 5,500 ETH to Anchorage Digital. Since January, Paradigm has transferred a total of approximately 97,000 ETH (over $300 million), a significant portion of which ultimately flowed into centralized exchanges.
These data reveal a signal: institutions are strategically 'cooling off' ETH. They are not abandoning it completely, but rather tilting their funds towards other assets, with Solana becoming the main new favorite. Even though Solana has been criticized for rampant bot activity and scams, it has shown strong technical resilience during the memecoin wave: no outages under high-frequency trading, low gas fees, and strong user engagement — all of which Ethereum currently struggles to provide.
Two, the myth of Ethereum's deflation shatters, moving towards an 'inflationary' blockchain?
The once-proud deflationary model now seems to have collapsed. The destruction mechanism brought by EIP-1559 and the merge is now difficult to prevent the renewed rise of ETH supply. Due to the continued low activity of main chain transactions, the amount of ETH destruction has sharply decreased. Data shows that the network transaction fees for the entire week in mid-April amounted to only 1,873 ETH — close to the lowest value in seven years.
The direct result of this is that the supply of ETH has now exceeded the levels at the beginning of the merge. This is a heavy blow to the valuation logic of Ethereum — having lost the value support of 'digital gold', ETH resembles an inflationary token, which is undoubtedly a warning signal for institutional investors who are more sensitive to capital.
Three, Vitalik's radical proposal: RISC-V replaces EVM, sparking controversy
On April 20, Vitalik proposed replacing the EVM with the RISC-V architecture, shocking the entire crypto circle. It should be noted that the EVM is the 'heart' of Ethereum, on which countless projects and contracts rely. The core of this proposal stems from the belief that the EVM is difficult to adapt to the demands of higher efficiency, parallel computing, and underlying resource scheduling.
Sei Labs co-founder Jayendra Jog bluntly stated that this is equivalent to Vitalik admitting: the original technical route of Ethereum has reached its limit and cannot solve performance bottlenecks through incremental upgrades. To continue moving forward, it can only 'scrape the bone to heal the wound'.
From an industrial perspective, this is an ultimate challenge to Ethereum's governance structure and development strategy: does a project with such a large ecosystem really have the capability to replace its most core underlying architecture without causing an ecological disaster?
Four, the decline of the mainnet and the rise of Layer 2: inflicting a thousand injuries on the enemy, self-harming eight hundred?
The current Ethereum mainnet not only faces a sharp drop in transaction fee income but also the 'value dilution' brought by Layer 2. Secondary networks like Arbitrum, Optimism, Base, etc., while greatly enhancing Ethereum's overall trading capacity, have also taken away user behavior and revenue that originally belonged to the main chain. In other words, while the overall ecosystem is active, the main chain itself is increasingly resembling a 'back-end settlement system'.
The original design logic of Ethereum was to achieve efficient scalability through Layer 2, but the current reality is that the value retention of the main chain has significantly declined, forcing an adjustment in the token economic model. This has led investment institutions, which originally valued the scarcity of the main chain, to reevaluate the long-term value of ETH.
Five, whales secretly 'buy the dip', is ETH still a 'missed opportunity'?
Although the current market does not have high short-term expectations for ETH, some funds choose to enter at low positions at this time. Lookonchain data shows that from April 22 to 23, multiple addresses cumulatively purchased over $100 million worth of ETH. The logic behind this behavior is that the market structure has not completely collapsed, and ETH remains a pole among top assets, although the cycle is temporarily lagging.
Standard Chartered recently lowered its 2025 target price for ETH from $10,000 to $4,000, reflecting a more conservative overall market expectation. Nevertheless, relative to the current price of $1,800, there is still more than double the upside potential. For funds that are optimistic about Ethereum's smart contracts and ecosystem position in the long term, these moments of 'pain points' often represent an opportunity to position themselves.
Summary: Ethereum remains a top asset, but the faith test has just begun
Ethereum is not experiencing a crisis of confidence for the first time, nor is it the first time it has been questioned about 'losing its future'. But this time, the challenges it faces are more complex: not only technical iteration bottlenecks but also strong competition from new public chain ecosystems (such as Solana) and the deep reconstruction needs of its internal value model.
The current market is in a subtle structural transition: short-term liquidity chasing new chains with higher performance and volatility; while ETH is rediscovering its value anchor in the future multi-chain world.
At this time, it might be worth trying to use Mlion.ai's 'on-chain data analysis' and 'capital flow tracking' modules to conduct deeper sentiment, address, and holding behavior exploration, accurately determining whether the whales are 'testing waters' or 'buying the dip'.
Opportunities often arise at the most hesitant moments. Can Ethereum this time rise from the ashes and return to the center stage? It is worth our close attention.
Disclaimer: The above content is for market research and information sharing only and does not constitute any investment advice. Investment involves risk; please proceed with caution.
