Institutions break up with Ethereum but keep ETH on the hook

Long-time investors are slashing their Ether balances as Ethereum begins self-improvement to fix its base layer.

Ethereum is entering one of its most precarious periods since its inception. Usage on the base layer is plummeting, core metrics are nearing multi-year lows, and even co-founder Vitalik Buterin is proposing a radical architectural overhaul.

Institutions aren’t waiting to see how it plays out. Blockchain data shows that long-time supporters such as Galaxy Digital and Paradigm have been slashing their Ether (ETH) holdings in recent weeks.

So far in April, Ethereum’s base-layer activity has continued to collapse. Ethereum’s network fees are dropping, and inflation has been rising. Though layer-2 networks continue to develop, they’re cannibalizing the base layer’s value capture.

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