Standard Chartered's digital assets research team released a report on Thursday asserting that Ethereum's network activity remains near record highs even as Ether (ETH) trades significantly below its August 2025 peak. The analysis highlights a widening divergence between fundamental usage metrics and market valuation, suggesting this gap may eventually narrow. Data compiled by Woofun AI indicates that ETH has declined approximately 57% from a high above $4,800 in August 2025 to under $2,000 at the time of writing. Despite this depreciation, internal metrics such as transaction counts and total value locked in ETH terms continue to hover near historical maximums.

Geoff Kendrick, the global head of digital assets research at Standard Chartered, reaffirmed long-term price targets of $4,000 by the end of 2026 and $40,000 by 2030. These projections imply a recovery of the ETH/BTC ratio to its 2021 highs around 0.08. Kendrick drew a parallel between the current market state and Amazon during the dot-com bust, noting that 'everything inside the company was going the right way' despite a slumping stock price. This analogy underscores the belief that underlying utility often precedes price appreciation in nascent technological sectors.

Max Shannon, head of research Europe at Bitwise, validated the Amazon comparison while identifying specific structural hurdles. He told Cointelegraph that the disconnect stems from Ethereum's 'lack of narrative' and 'lack of value accrual from cheap layer-1 and later-2 transactions.' Shannon argued that value accrual could improve as onchain assets and their velocity increase, alongside users paying higher gas fees for premium services. These services include zero-knowledge transactions, pre-confirmations, maximal extractable value, and large institutional trades.

The report emphasizes Ethereum's pivotal role as the primary settlement layer for stablecoins and tokenized real-world assets. Projections indicate that stablecoin market capitalization will grow sixfold to about $2 trillion by 2028, while tokenized non-stablecoin assets will expand 50-fold to a similar size. Woofun AI notes that Ethereum currently hosts roughly half to two-thirds of each of these burgeoning markets. Transaction volume on the network reached an all-time high of more than 3.6 million on April 28 before dropping to around 2.2 million on Thursday, .

Concurrently, total value locked in decentralized finance has contracted from around $97 billion in August to $41.65 billion on May 27, per DeFiLlama figures. Justin d'Anethan, head of research at Arctic Digital, described it as 'heartwarming to see a traditional bank stick to their thesis' amidst disappointing market sentiment. He observed that in crypto, price is 'often its own narrative,' while fundamental value frequently becomes 'an afterthought.' This sentiment reflects a broader industry struggle to align market perception with on-chain fundamentals.

Market signals remain mixed, with Bitmine Immersion Technologies, the largest public buyer of ETH owning over 5,300,000 ETH, doubling down on expectations of a supercycle. The firm cited Wall Street's interest in tokenization and artificial intelligence-powered agents as key drivers.

However, this optimism contrasts with a wave of departures from the Ethereum Foundation and skepticism from long-time commentators regarding how much network growth will ultimately accrue to ETH itself. Woofun AI analysis suggests that institutional positioning will be the critical variable in resolving this uncertainty.

US spot ETH exchange-traded funds present another layer of complexity to the outlook. Farside ETH ETF data reveals the products posted a $67.1 million net outflow on May 27, marking 11 consecutive days of withdrawals despite earlier inflow sessions. D'Anethan questioned whether Ethereum's tailwinds will outpace Bitcoin's in the long term, noting that previous cycles where altcoins outperformed BTC no longer hold. He stated it will be interesting to see where large trading firms, institutions, sovereign funds, and nation-states ultimately place their bets.

Shannon added that Bitwise's Factor Model shows momentum has been driven primarily by Bitcoin, with approximately 80% of ETH price variation explained by BTC movements. He concluded that macro factors, equities, and fundamental drivers such as active addresses have all taken a back seat in the current market regime. This correlation suggests that until Ethereum decouples from Bitcoin's price action, its valuation may remain constrained by broader market dynamics rather than its own specific utility growth.