- Ethereum recent upgrade and rising institutional interest haven’t prevented on-chain user activity from remaining stagnant, JPMorgan warns.
- The network’s growing appeal to regulated institutions has yet to spark enthusiasm among retail users
Ethereum latest network upgrade, dubbed Pectra, promised faster fund movement and improved staking—features designed to appeal to institutional investors. Yet, despite these enhancements, JPMorgan is sounding the alarm: Ethereum’s growth remains flat, and on-chain user activity shows little sign of revival.
In a recent note, JPMorgan analysts highlighted a concerning pattern. While Ethereum’s infrastructure continues to evolve—now supporting compliance-friendly token standards like ERC-3643 and ERC-1400—retail engagement has not kept pace. Daily transactions, active addresses, and other key user metrics have stagnated, signaling weak demand despite Ethereum’s technical strides.
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The pivot toward institutions is evident. Ethereum now aligns more closely with traditional finance through features like KYC and AML integration, making it attractive to regulatory-conscious players. Endorsements from major clearinghouses like the DTCC reinforce this trend. Ethereum’s trajectory increasingly mirrors that of Bitcoin, where institutional adoption played a critical role in reshaping its market dynamics.
Evidence of institutional interest is also mounting on the CME, with rising long positions in Ethereum futures. Yet, the muted reception of spot Ethereum ETFs—especially in comparison to Bitcoin ETFs following Trump’s recent political gains—underscores a gap in retail enthusiasm.
On the bright side, Ethereum saw its highest weekly inflows of 2025, totaling $205 million, even as its price dipped nearly 3%. Total value locked (TVL) is also on the rise, hinting at growing activity in DeFi sectors like lending and borrowing. Still, analysts remain cautious, citing low transaction fees, growing Layer 2 adoption siphoning activity, and an increasing ETH supply as potential headwinds.
The disconnect is clear: Ethereum is gaining favor with institutions but struggling to reignite excitement among everyday users. Whether the network can bridge this divide and translate technical upgrades into real-world usage will define the next chapter of Ethereum’s evolution.
