Ethereum has reclaimed the $3,200 level, but traders remain cautious about whether Ether can successfully turn former resistance into durable support — or whether weaker application usage and U.S. macro uncertainty will continue to cap upside near $4,000.Key takeawaysEther trades near $3,200, but has repeatedly failed to sustain moves above $3,300 over the past two months.Declining DApp usage and DEX volumes are weighing on network fees and near-term demand for ETH.Layer-2 networks dominate Ethereum activity, while cheaper rival chains reduce the odds of a rapid push back to $4,000.ETH struggles to reclaim $3,300 despite network upgradesEther has spent most of the past 60 days trading below $3,300, raising questions about whether a durable bullish trend is still achievable in 2026. Despite ongoing protocol upgrades and Ethereum’s continued dominance in deposits and total value locked (TVL), investors appear unconvinced that a sustained breakout is imminent.At roughly $3,200, ETH is testing a level that previously acted as resistance through late 2025. The failure to decisively reclaim higher ground has reinforced the view that Ether’s upside is constrained by broader market conditions rather than ecosystem-specific issues.Since November, ETH’s price performance has closely tracked movements in the total crypto market capitalization, suggesting that macro sentiment and overall risk appetite are playing a larger role than Ethereum-specific fundamentals.Weaker DApp usage drags on fees and short-term demandSigns of softer demand are most visible in decentralized application activity.According to data from DefiLlama, aggregate decentralized exchange (DEX) volumes over the past two weeks totaled $150.4 billion, down 55% from the all-time high of $340 billion recorded in January 2025.Ethereum-based DEX volumes have fallen sharply as well. Seven-day DEX volumes on Ethereum are hovering near $9 billion, down from a peak of $27.8 billion in October 2025 — a 65% decline. Over the same period, Ethereum network fees dropped 87%, falling to roughly $2.6 million from $21.3 million three months earlier.Despite the slowdown, Ethereum’s broader ecosystem remains dominant. When combining activity across Base, Arbitrum, Polygon, and other layer-2 solutions, Ethereum-aligned networks still account for around 50% of total DEX volume, underscoring its central role in decentralized finance.Layer-2 dominance reshapes Ethereum’s economic profileEthereum’s leadership in TVL continues to signal strong institutional preference, even as competitors such as Tron, Solana, and BNB Chain generate higher base-layer fees.Critics often argue that Ethereum has failed to fully monetize its dominance in smart-contract deposits. Supporters counter that this outcome is intentional, reflecting Ethereum’s rollup-centric scaling strategy, which prioritizes security and decentralization over base-layer fee maximization.Transaction data highlights this divergence. According to Nansen, Ethereum processed 54.4 million transactions over a recent 30-day period, while its layer-2 network Base alone recorded more than 600 million transactions during the same timeframe.By contrast, Solana’s base layer processes more transactions than its top 10 competitors combined, reflecting a design that emphasizes high throughput and low latency at the cost of greater coordination and a more centralized development model led by Solana Labs.Balance-sheet pressure adds to ETH headwindsEther’s prolonged consolidation below $3,200 has also weighed on firms that raised debt or equity to accumulate ETH.Bitmine Immersion, for example, reportedly holds $13.2 billion worth of Ether, yet its shares trade at a 9% discount to the value of those holdings, according to CoinGecko data. The gap highlights investor skepticism toward ETH’s near-term upside and the risks associated with leveraged exposure to a range-bound asset.What would reignite a move toward $4,000?For now, a clear catalyst capable of shifting momentum decisively back in Ethereum’s favor remains elusive.Rival networks continue to offer comparable decentralized applications with lower friction, while economic uncertainty in the United States is limiting broader risk appetite. Without a meaningful rebound in on-chain activity, fee generation, or macro-driven demand for crypto assets, Ether’s path back to $4,000 and beyond appears challenging.Bottom line: Ethereum remains the backbone of decentralized finance, but price leadership in 2026 will depend less on protocol upgrades and more on whether application demand and global risk sentiment recover in a meaningful way.
Joy
