ETH rally to $2.5k sustained by macro, war, DApp usage

Key considerations:

• ETH derivatives signal a transition to safety as professional desks hedge against downside risks and global volatility.

• Institutional preference for decentralization keeps Ethereum dominant despite declining network activity.

The price of Ether (ETH) fell 6% after a brief rally to $2,200 on Wednesday, tracking losses in US stocks as the war in Iran entered its sixth day. A disruption in global oil production and Middle Eastern natural gas shipments pushed WTI prices to levels not seen since July 2024.

Investors have downgraded their outlook for economic growth since the conflict escalated and shifted to risk-on mode.

Traders’ sentiment was further weighed down as the Trump administration faced a legal loophole in its import tariffs. A federal judge on Monday denied the Justice Department’s request to stay the case for 90 days, effectively ending the administration’s use of emergency powers for trade tariffs.

Ether remains in this macroeconomic bullfight, stalling momentum despite a 22% recovery from the February 24 retest of $1,800. Currently, the markets of Onchain and its derivatives reflect significant indifference from the bull.

The annualized 30-day ETH futures premium is well below the neutral 5% threshold, suggesting a lack of demand for leverage. However, this measure means that ETH is trading 58% lower than its August 2025 all-time high of $4,956. In order to determine whether the professional tables predict further downside, you need to analyze the options market.

As the sharks and market makers protect against price declines, the ETH options curve (forward call) tends to rise above the neutral 6% mark. Severe market stress can increase this rate by more than 15%.

ETH options rose 7% on Thursday after reaching neutral levels the day before. This lingering skepticism among professional traders gives the bears the leverage they need to fuel further uncertainty. Aside from external macro pressures, including US private credit losses and increasing corporate layoffs, Ether faces headwinds of its own.

Ethereum is poised to pick up demand in DApps

Ethereum network activity has stagnated after a modest rally in early February. Continued demand for blockchain services remains critical to stable ETH price action and easing inflationary pressures. Ethereum’s built-in fueling mechanism depends on competition to get into the validation queue, a process that is usually fueled by decentralized exchange (DEX) activity.

Weekly DEX volume on the Ethereum network recently hit $12.6 billion, down from $20.2 billion a month ago. Decentralized application (DApp) revenue fell to $14.1 million in seven days, a 47% drop from last month. Competing blockchains saw a similar trend, as Solana’s DEX volume dropped by 50% in the same 30-day window.

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Despite weak onchain metrics, ETH is poised to gain a foothold in DApp activity due to its dominance in total block value (TVL). When including layer 2 scaling solutions, the Ethereum ecosystem accounts for approximately 65% ​​of the total TVL blockchain market.

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Ethereum’s base layer has $55.4 billion in TVL, while its leading competitor, Solana, has $6.8 billion. This gap serves as an argument for the preference among institutional investors for decentralization over the lower fees and faster user experience offered by networks like Solana and BNB Chain.

The current weakness in Ether derivatives and onchain metrics does not necessarily indicate an imminent price crash. Market sentiment may soon move to a sustained upward trend if ETH recovers the $2,400 level. Currently, the price of Ether is associated with a broader sense of risk, reducing the likelihood of sustained upward momentum.