The Ethereum ecosystem is getting busier, but why might ETH not rise in step?
When discussing Ethereum, it’s easy to confuse two things: people using the network and the price of ETH going up.
They are related, but one doesn’t automatically lead to the other.
One important goal of Ethereum’s scaling efforts is to let users transact at lower cost. More activity taking place on Layer 2 can improve the user experience, but the fees users pay to L2s do not all become fees paid to Ethereum’s mainnet.
So an increase in the number of transactions doesn’t mean that mainnet fee revenue and the amount of ETH burned will necessarily increase in proportion.
Base fees on Ethereum’s execution layer are burned, and blobs have their own fee mechanism. The amount ultimately burned depends not only on usage, but also on whether the relevant capacity is congested and what fees are being charged. “Cheaper transaction fees” shouldn’t be taken to mean that ETH’s value must fall, just as “more users” shouldn’t be taken to mean that ETH must become scarcer.
To assess ETH, it’s more useful to connect three things.
First, is ecosystem demand growing, and is the new activity sustainable?
Second, how does this activity create demand for ETH, and how are fees paid to the mainnet changing?
Third, what is the relationship between new issuance and burning? More ETH being burned doesn’t necessarily mean the total supply will shrink; it must also be compared with new issuance over the same period.
That’s why it’s important not to look only at ETH’s price in U.S. dollars when assessing the market. ETH/BTC can help compare the relative strength of the two assets, but it is still just a price outcome. It needs to be considered alongside network usage, fees, and market demand for capital. For example, the platform BiyaPay uses USDT as its core funding gateway, connecting users through one account to a range of financial services, including cross-border remittances, global stocks, cryptocurrencies, commodity futures, wealth management, forex, and U Card payments. The key is to distinguish whether ETH is being affected by changes in its own ecosystem or by shifts in risk appetite that are affecting both tech stocks and digital assets.
The question worth asking—more than whether “the chain is busy”—is how growth in the Ethereum ecosystem ultimately translates into sustained demand for ETH.
#以太坊 #ETH #Layer2 #BiyaPay
When discussing Ethereum, it’s easy to confuse two things: people using the network and the price of ETH going up.
They are related, but one doesn’t automatically lead to the other.
One important goal of Ethereum’s scaling efforts is to let users transact at lower cost. More activity taking place on Layer 2 can improve the user experience, but the fees users pay to L2s do not all become fees paid to Ethereum’s mainnet.
So an increase in the number of transactions doesn’t mean that mainnet fee revenue and the amount of ETH burned will necessarily increase in proportion.
Base fees on Ethereum’s execution layer are burned, and blobs have their own fee mechanism. The amount ultimately burned depends not only on usage, but also on whether the relevant capacity is congested and what fees are being charged. “Cheaper transaction fees” shouldn’t be taken to mean that ETH’s value must fall, just as “more users” shouldn’t be taken to mean that ETH must become scarcer.
To assess ETH, it’s more useful to connect three things.
First, is ecosystem demand growing, and is the new activity sustainable?
Second, how does this activity create demand for ETH, and how are fees paid to the mainnet changing?
Third, what is the relationship between new issuance and burning? More ETH being burned doesn’t necessarily mean the total supply will shrink; it must also be compared with new issuance over the same period.
That’s why it’s important not to look only at ETH’s price in U.S. dollars when assessing the market. ETH/BTC can help compare the relative strength of the two assets, but it is still just a price outcome. It needs to be considered alongside network usage, fees, and market demand for capital. For example, the platform BiyaPay uses USDT as its core funding gateway, connecting users through one account to a range of financial services, including cross-border remittances, global stocks, cryptocurrencies, commodity futures, wealth management, forex, and U Card payments. The key is to distinguish whether ETH is being affected by changes in its own ecosystem or by shifts in risk appetite that are affecting both tech stocks and digital assets.
The question worth asking—more than whether “the chain is busy”—is how growth in the Ethereum ecosystem ultimately translates into sustained demand for ETH.
#以太坊 #ETH #Layer2 #BiyaPay