Journalist
Posted:
L1s are still navigating the fine line between belief and speculation. And Ethereum [ETH] really illustrates this dynamic.
In terms of developers, the company is far ahead, with deployed contracts reaching a record 9.1 million in the fourth quarter of 2025, even as the price corrected 45%, marking the worst quarterly performance since the 2018 bear market.
Despite these headwinds, however, the tremendous level of developer activity indicated a strong, resilient foundation for ETH, paving the way for Ethereum to continue a fundamentals-driven long-term rally into 2026.
Source: Token terminal
Remarkable, that’s what it is appear in the chain.
NFT volume puts Ethereum in the lead, with $12.6 million flowing through the network. DApp activity? A staggering increase of 1,135% to $180 billion per week. In short, all that developer energy directly fuels real network usage.
But here’s the kicker: the price doesn’t fully reflect this. Even with this kind of on-chain activity, Ethereum still lags behind Bitcoin [BTC] by almost 1.5x. That’s a pretty big gap compared to what we’ve seen in previous rallies.
The question, of course, is: can ETH repeat its second-quarter gains versus BTC?
Ethereum’s on-chain power encourages off-chain speculation
ETH’s short-term prospects weigh on its long-term growth potential.
Even with strong developer activity, ETH has fallen below $2k Vitalik Buterin continues to sell. In the meantime, statistics in the chain indicate a strong leverage-driven sentiment, which shows little sign of spot accumulation.
At the same time, the ETH/BTC ratio continues to fluctuate within a tight range, but is still down 0.28% this week. This reinforces Ethereum’s bearish setup and indicates the absence of meaningful rotational flows from BTC to ETH.
Source: TradingView (BTC/ETH)
All things considered, speculation clearly outweighs belief.
From a sentiment perspective, that alone puts a damper on Ethereum’s long-term potential, with the market still too focused on short-term moves. As a result, a repeat of Q2 2025 gains against BTC seems unlikely.
Instead, if this trend continues, ETH will extend losses to BTC in Q2.
Final summary
- Ethereum’s developer activity and on-chain growth remain at record highs, but the price is lagging and ETH still trails BTC by 1.5x.
- The leverage-driven sentiment and lack of BTC flows suggest that ETH’s weakness could persist in the near term, making a repeat of the gains in Q2 2025 unlikely.