Written by: Alex O'Donnell

Translated by: Saoirse, Foresight News

The Ethereum network is gaining recognition on Wall Street, but investors still do not have a favorable view of ETH as a whole.

In recent months, the pace of institutional acceptance of Ethereum has significantly increased. Since May, financial institutions such as JPMorgan, Robinhood, and Morgan Stanley have successively launched various Ethereum-related products and services. In July, several former members of the Ethereum Foundation established a non-profit independent organization, Ethereum Institutional, aimed at accelerating the adoption of Ethereum by major institutions.

Meanwhile, Ethereum co-founder Vitalik Buterin released a major network upgrade roadmap titled "Lean Ethereum," which aims to enhance Ethereum's privacy capabilities and resistance to quantum attacks.

However, the market has not provided positive feedback. At the time of this article, the trading price of ETH was slightly above $1900, down more than 60% from its historical high of around $4950 in August 2025. Analysts generally believe that it is difficult for ETH to return to previous highs in the short term. On July 1, Citibank lowered its 12-month price expectation for Ethereum from $3175 to $2240, citing weakened investor demand and continuous net outflow of Ethereum ETF funds.

The research team at Galaxy stated that the disconnect between market trends and fundamentals is quite clear: more and more investors are confused about ETH's value growth logic.

Wall Street's Layout Continues to Expand

Today, the application of blockchain by institutions is no longer limited to pilot attempts, with Ethereum being one of the biggest beneficiaries of this trend.

In May, JPMorgan Asset Management launched a second tokenized money market fund, JLTXX, on the Ethereum public chain. In July, the online broker Robinhood launched Robinhood Chain, a Layer 2 network on Ethereum designed specifically for financial services and tokenized assets.

Morgan Stanley is also promoting ETH to further enter mainstream securities accounts. Qualified E*TRADE users can now trade and hold Ethereum, Bitcoin, and SOL.

The reason major institutions continue to increase their investment in Ethereum is because Ethereum has a mature developer ecosystem and a large, decentralized network of validating nodes, which likely means institutional layouts will accelerate further.

ConsenSys CEO Joe Lubin mentioned in a statement on July 1 that the vast majority of stablecoin issuances, tokenized assets, decentralized finance, and various on-chain financial infrastructure will prefer Ethereum.

A Grand Upgrade Plan

In addition, Ethereum is about to undergo a comprehensive technological revolution that will further enhance its attractiveness to various institutions.

In July, Buterin publicly revealed the "Lean Ethereum" development plan, with an entire reconstruction cycle expected to last three to four years. He stated that the scale of this upgrade is comparable to the network-wide upgrade Ethereum underwent when it transitioned to a proof-of-stake consensus mechanism in 2022.

This upgrade aims to reduce the cost of using Ethereum, enhance network security, and simultaneously optimize user privacy protection — an important point for institutional traders. If the upgrade proceeds smoothly, Ethereum is expected to become one of the first blockchains with reliable resistance to quantum attacks.

Ethereum Foundation researcher Justin Drake stated in July that strong security properties will become a natural advantage for attracting global institutions to migrate to Ethereum.

Economic Fundamentals Full of Uncertainty

Despite a series of positive news, the price of ETH remains sluggish.

One of the root causes lies in Ethereum's scaling solutions. Ethereum relies heavily on Layer 2 blockchains to achieve lower costs and higher efficiency in transaction processing.

Theoretically, the higher the on-chain activity, the more transaction fees generated, and the market demand for ETH would also rise. However, data from L2Beat shows that from 2024 to now, the vast majority of transactions in the Ethereum ecosystem are handled by Layer 2 networks, which only settle final transactions on the Ethereum mainnet periodically.

The scaling solutions significantly reduced transaction costs, helping Ethereum handle more traffic, but also severed the connection between on-chain activity and ETH demand: many transactions have moved off the mainnet, leading to a decrease in transaction fees earned by the Ethereum mainnet.

Researchers at 21Shares stated in January that while such changes benefit ordinary users, they present mixed pros and cons for ETH holders. Unless the overall on-chain transaction volume surges enough to compensate for the decline in transaction fees, the reduction in fees will lead to fewer ETH being burned.

Market Predictions Polarized

Currently, Ethereum is very likely to grow into a core infrastructure in the financial sector, but how much dividends ETH holders will eventually reap remains uncertain. The price expectations from different sectors of the industry vary widely.

Citibank predicts that the ETH price will be slightly over $2000 in 12 months; Standard Chartered is much more optimistic, expecting ETH to reach $4000 by the end of 2026 and $40000 by 2030.

BitMine Chairman Tom Lee is even more aggressive, believing that ETH's long-term price could reach as high as $250,000, corresponding to a total market cap of about $30 trillion.

In summary, the probability of Ethereum becoming a mainstream core financial infrastructure is increasing, but whether ordinary holders can fully share in the industry’s development dividends remains full of uncertainty.