ETH price rose above $2,150 as Bitcoin and US stock markets rallied. But does the information show whether derivatives traders have already turned bullish?
Key Takeaways:
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Ethereum maintains dominance in its total value locked metric, but faces scrutiny on Layer 2 scaling.
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ETH inflation rose to 0.8% as on-chain activity slowed, while macroeconomic fears within the US kept derivatives markets in bearish territory.
Ether (ETH) price managed to reclaim $2,100 after plunging 43% in nine days, with the altcoin hitting a low of $1,750 on Friday. Despite a 22% rally after hitting its lowest price since April 2025, ETH derivatives markets proceed to reflect investor fears of further downside. Regardless of whether the macroeconomic environment causes investor concern, the probabilities of sustained upward momentum for ETH within the near term remain slim.
Two-month ETH futures premium on an annual basis. Source: laevitas.ch
ETH monthly futures traded at a 3% premium to regular spot markets on Monday, below the neutral threshold of 5%. This lack of optimism amongst Ether traders has been consistent over the past month and has shown no signs of improving at the same time as the worth fell towards $1,800. Unless the bulls intervene and show strong risk-taking at these levels, the bears are prone to remain on top of things.
ETH/USD (orange) vs. total crypto capitalization (blue). Source: TradingView
ETH underperformed the broader cryptocurrency market cap by 9% in 2026, leading investors to query what’s siphoning away capital. From a broader perspective, the declining interest in decentralized applications (DApps) just isn’t just affecting Ethereum. The network stays the dominant leader in total value locked (TVL) and fee generation when aggregating its Layer 2 solutions.
Blockchains sorted by TVL (left) and 30 day fees (right), USD. Source: DefiLlama
Deposits on the Ethereum base layer account for 58% of your entire blockchain industry; this number exceeds 65% when including Base, Arbitrum and Optimism. For example, the biggest application on Solana barely exceeds $2 billion in deposits. In comparison, the biggest DApp on the Ethereum base layer has a TVL of over $23 billion. Solanas Jupiter wouldn't even crack the highest 14 on Ethereum.
ETH supply growth and layer 2 Subsidies remain problematic
The Ethereum base layer ranked third in network fees, generating $19 million in 30 days, while the Layer 2 ecosystem contributed one other $14.6 million. Ethereum has been criticized for heavily subsidizing scalability through optimistic rollups – a method that Vitalik Buterin himself admitted must be adjusted. Ethereum's co-founder argued on Tuesday that the network should prioritize base layer scalability.
According to Buterin, the Layer 2 path to decentralization turned out to be harder than expected. According to reports, the present solutions are based on multisig-driven bridges, which doesn’t meet the safety standards called for in Ethereum's original vision. Buterin points out that this just isn’t the tip of Layer 2, because the demand for networks that supply data protection features and application-specific design will proceed, especially for non-financial use cases.
ETH supply change, 30 days. Source: ultraschall.money
Part of investors' disappointment might be explained by the undeniable fact that Ether's strategy didn’t turn out to be deflationary, which is a secondary effect of the reduced activity of the Ethereum network. The integrated burning mechanism is dependent upon the demand for basic-level data processing. Without it, there will probably be a net increase in ETH supply. Annual growth in total ETH issued reached 0.8% over the past 30 days, a major increase from last 12 months when corresponding inflation was near 0%.
Ether traders remain skeptical that a sustained recovery can occur within the near term on account of increased uncertainty within the US labor market and the long-term sustainability of investments in artificial intelligence infrastructure. Consequently, the weak ETH derivatives markets are a mirrored image of general risk aversion and a slowdown in on-chain activity, aspects that can likely take longer to stabilize.
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