Ethereum in 2026: Still the Backbone of Crypto

Key Takeaways

• Ethereum holds $90 billion ($55B USD) in decentralised finance (DeFi) Total Value Locked, more than all other blockchains combined
• Over $265 billion ($165B USD) in stablecoins run on Ethereum
• Ethereum's recent upgrades have made its mainnet significantly cheaper and faster for everyday use
• Institutions continue to choose Ethereum for tokenised assets and financial infrastructure over rival blockchains

What Is Ethereum?

Ethereum is a programmable blockchain that launched in 2015. Unlike Bitcoin, which was designed primarily to transfer value, Ethereum was built to run applications. Developers can write code that lives onchain and executes automatically, without an intermediary or middleman. These are called smart contracts.

That programmability made Ethereum the foundation for DeFi, a category of financial services that runs entirely onchain. Borrowing, lending, trading, and earning yield can all happen on Ethereum without a bank or broker involved. Over the years, that ecosystem has grown into something that rivals parts of traditional finance in scale.

The Metrics That Still Set It Apart

The simplest way to understand Ethereum's position is to look at where the money sits. Total value locked (TVL) measures how much capital is actively deployed in a blockchain's DeFi ecosystem. Ethereum holds an estimated AUD $90 billion ($55-68B USD) in TVL. The next closest competitor holds around AUD $11 billion ($7B USD). It is not a close race.

DeFi TVL per chain (source)

Daily trading volume through decentralised exchanges (DEXs) on Ethereum runs at around $6.9 billion ($4.3B USD) per day, among the highest of any blockchain. The network also hosts over $265 billion ($165B USD) worth of stablecoins, digital currencies pegged to traditional currencies like the US dollar.

These numbers reflect something beyond brand recognition. Ethereum has 120 million unique addresses and has seen daily transactions and active wallets reach multi-year highs recently. Developers build where users are, and users go where the applications are. That cycle has been reinforcing itself on Ethereum for a decade.

Stablecoins, Real-World Assets, and Why the Settlement Layer Matters

Stablecoins are the clearest sign of Digital asset usage yet, and most of that happens on Ethereum. When a financial institution or fintech company wants to move value onchain, they need a network they trust. Ethereum's depth of liquidity, years of security track record, and large developer community make it the default choice.

Stablecoin supply change per chain (source)

Real-world assets (RWAs) are the next layer of that story. RWAs are traditional financial instruments, things like government bonds, money market funds, and tokenised equities, that have been brought onchain as digital tokens. Ethereum currently hosts an estimated AUD $23 billion ($16.5B USD) in non-stablecoin RWAs, while BNB Chain and Solana sit in the low billions. That gap exists because institutions placing real financial assets onchain need to trust the underlying network completely, and Ethereum has had longer to build that trust than any other smart contract platform.

The combination of stablecoins and RWAs positions Ethereum less like a speculative asset and more like financial infrastructure. Several major institutions have chosen Ethereum as the settlement layer for tokenised financial products as a result.

Real-world assets per chain (source)

Layer-2s, Mainnet Upgrades, and What Comes Next

Layer-2 (L2) networks are blockchains that sit on top of Ethereum and process transactions more quickly and cheaply. They bundle thousands of transactions together and periodically settle the result back to Ethereum's mainnet for security. Networks like Arbitrum, Optimism, Base, and several others now handle millions of transactions per day.

L2s were seen as Ethereum's main answer to high fees and slow speeds but after a major upgrade to Ethereum's data handling, the cost for L2s to post data to mainnet reduced by between 50% and 90%, making the entire Ethereum ecosystem, mainnet and L2s combined, cheaper and faster than it was previously. Mainnet itself averages around 23 transactions per second with peaks exceeding 30, which is not fast by raw throughput standards, but its role as a secure settlement layer makes that number less relevant than it once was.

The Ethereum Foundation continues to develop the network, with upcoming changes focused on making the L2 experience more seamless and further reducing costs. Changes are methodical rather than rapid, which reflects the weight of responsibility that comes with securing hundreds of billions in assets.

Opportunities and Risks

Ethereum's clearest opportunity lies in the continued growth of institutional adoption. ETF products tied to ETH have shown strong interest since they began trading in 2024. As more financial products move onchain, the infrastructure those products depend on becomes more valuable, and Ethereum is the most likely beneficiary of that shift.

Ethereum's mainnet throughput remains low compared to rivals. Solana processes transactions faster on a single chain with a simpler user experience, and it has gained significant ground in trading and staking activity, including surpassing Ethereum in DEX trading volume. The L2 ecosystem, while technically impressive, remains complex and fragmented. Many users find it confusing to navigate multiple networks and bridge assets between them.

Summary

Ethereum remains the dominant settlement layer in crypto by most meaningful measures. Its DeFi depth, stablecoin supply, and RWA adoption are not matched by any other network. The security track record is the longest of any programmable blockchain, and institutions continue to build on it.

Whether that technical and institutional lead translates into performance relative to faster-moving competitors is the question worth watching. Ethereum is not standing still, but neither is the field around it.