Ethereum, Solana and Avalanche See Rising Activity and Lower Costs Despite Token Price Drops: Bitwise
Blockchain networks like Ethereum, Solana and Avalanche grew busier and cheaper to use over the past year. Staking participation stayed high and institutional interest increased. Yet their tokens fell sharply in price.
ETH, SOL and AVAX each dropped by roughly 50% or more compared to a year ago.
Network Fundamentals Improve While Prices Fall
Bitwise Head of Onchain Research Kam Benbrik noted a clear gap between network health and market sentiment. Prices are lower than in 2025. Onchain data shows blockchains becoming cheaper and activity rising.
Bitwise released its first quarterly staking report. Transactions increased and costs fell. However, network revenues declined across Ethereum, Solana and Avalanche. The drop mainly came from protocol design that made blockspace cheaper and more available. Weaker demand played a smaller role in some cases.
Institutional Staking Drives Ethereum Growth
Institutional players now dominate new Ethereum staking. ETFs, corporate treasuries and large holders added most of the ETH to the validator pool this year. A record 40.2 million ETH — about one-third of total supply — was staked by the end of the second quarter.
Bitmine, the largest Ethereum treasury, said it is staking over 4.9 million of its roughly 5.8 million ETH. Benbrik confirmed that recent inflows mainly come from institutions.
Staking Yields Rely Heavily on Token Issuance
Ethereum’s annualized staking yield stood at 2.84% in the second quarter. Solana’s yield reached 6.25%. Nearly all rewards came from new token issuance rather than user fees — 93% on Ethereum and more than 90% on Solana.
Holders who do not stake face dilution risk. Higher participation also spreads rewards thinner and lowers yields.
Liquid Staking Offers Flexibility for Investors
Many Bitwise clients stake both for yield and to support the network. Some want exposure to staking rewards plus onchain activity. Liquid staking solutions meet this need. Users keep the yield while using the token for DeFi actions such as providing liquidity or borrowing against collateral.
