The Ethereum (ETH) ecosystem is facing a combination of structural advances and market uncertainty. On the one hand, developers are rolling out a series of scalability upgrades aimed at lowering fees and increasing capacity across the network.
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Meanwhile, large holders have taken advantage of recent price strength to reduce exposure and introduce short-term selling pressure. These opposing forces are coming together to shape Ethereum’s near-term outlook as ETH trades above the $3,200 level.
The contrast is clear: protocols are absorbing more capital through staking and infrastructure improvements, while parts of the market are testing how much supply and demand they can absorb during the rally.
ETH's price moving sideways on the daily chart. Source: ETHUSD on Tradingview
Scalability roadmap moving forward
Ethereum developers activated the second Blob Parameter Only (BPO) hard fork this week, increasing the blob limit from 15 to 21 and the blob target from 10 to 14.
BLOBs are temporary data containers used primarily by rollups to batch transactions more efficiently. Each BLOB holds 128 kilobytes, allowing the network to handle approximately 2.6 megabytes of BLOB data per block.
This upgrade is part of a broader effort to scale Ethereum through a layer 2 network rather than pushing all activity to the main chain. Since the first BPO fork in December, Ethereum transaction fees have become less volatile, reflecting less congestion from moving data off-chain due to rollups.
Developers are already discussing further changes, including raising the gas limit from 60 million to 80 million, and then up to 200 million under the planned Gramsterdam hard fork in 2026. This upgrade introduces parallel transaction processing, which is expected to further improve throughput.
Liquid supply is tight due to increased Ethereum (ETH) staking
At the same time, staking activity is reshaping Ethereum’s supply dynamics. As highlighted by BitMine’s latest deposits, participation by institutional investors is increasing, with the total ETH staked approaching 780,000 tokens worth over $2.5 billion.
According to network-wide data, more than 1.3 million ETH is waiting to participate in staking, while validator exit queue is at zero. This imbalance suggests that even in the face of market volatility, fewer validators choose to exit.
Circulating supply on exchanges continues to decline as more ETH is locked into consensus contracts, potentially limiting downside pressure in the medium term.
Whale sales increase short-term pressure
Despite these fundamentals, large holders have recently turned into net sellers. Whale wallets holding between 100,000 and 1 million ETH sold about 300,000 ETH (equivalent to about $970 million) in three days.
This sell-off coincides with ETH’s breakout from a multi-week downward wedge, indicating that some whales are looking to capitalize on this rally for profit.
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Long-term holders remain largely inactive, contributing to broader structural stability, but continued distribution by whales could slow upside momentum. Ethereum is currently at a crossroads balancing protocol-level advances with market-driven supply pressures as traders assess whether demand can sustain the next high.
Cover image from ChatGPT, ETHUSD chart from Tradingview
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