Ethereum’s (ETH) exchange rate against Bitcoin (BTC) has fallen to a five-year low of 0.02260. The latest data shows Ethereum is trading at $1,894 as of March 29, 2025.

The notable decline in ETH/BTC rates is attributed to Ethereum’s plummeting fee revenues and transaction activity, leading some experts to criticize Ethereum’s investment potential.

ETH/BTC Plummets: Financial and Social Repercussions

The ETH/BTC exchange rate decline accompanies a significant drop in Ethereum’s transaction fee revenues. Nic Carter, partner at Castle Island Ventures, emphasized these issues in a statement on Twitter, attributing them to “greedy Eth L2s” impacting the Layer 1 network. The current trading rate marks a five-year low for ETH/BTC at 0.02260, indicating challenging investment sentiment for Ethereum.

Ethereum’s transaction fees have reportedly decreased significantly. On-chain data revealed a 95% drop in transaction fee revenue from $4.3 billion at the end of 2021 to $217 million in Q1 2025. Adam Cochran of Cinneamhain Ventures proposed that “based rollups could help address L2-induced revenue issues.”

Investor opinion is divided on Ethereum’s investment prospects. Quinn Thompson from Lekker Capital stated that Ethereum is “completely dead” as an investment, citing shrinking user growth and trading activity. Market figures highlight the declining confidence. Twitter discussions indicate mixed reactions, with influential investors voicing concerns.

Ethereum’s Investor Sentiment Wanes as Metrics Deteriorate

Did you know? The decreasing Ethereum transaction fees parallel a 99% revenue drop noticed in the six months prior to September 2024, largely due to Layer 2 activities.

Ethereum’s current market data shows its price at $1,808.35, with a market cap of approximately $218.19 billion. The 24-hour trading volume stands at $9.98 billion, marking a 22.07% decrease. Recent 24-hour, 7-day, 30-day, and 60-day changes show declines of 2.63%, 10.40%, 15.86%, and 41.62%, respectively, according to CoinMarketCap.

The Coincu research team emphasizes that the Ethereum market will likely continue to face challenges presented by Layer 2 disruptions. They recommend closely watching amendments to incentive structures that might mitigate the impact on Ethereum’s base layer. Layer 2 activities are seen as both an opportunity and a hurdle for Ethereum.