Ethereum's L1 fees have fallen to record lows, and network revenue declined from $366.63 million in Q3 2025 to $260 million in Q1 2026 after the Glamsterdam upgrade cut fees by 78%. Even so, monthly transactions have climbed to a new all-time high near 80 million, suggesting usage remains strong despite weaker fee-driven revenue. ETH is also down about 6.2% in May, raising debate over whether the market is undervaluing its on-chain activity.

Stablecoin supply expanded to around $323 billion, with more than $3 billion added this month, as liquidity conditions improved. Ethereum’s staking ratio also climbed to a new all-time high of 32.4%, while ETH/BTC stayed under pressure after weeks of declines. The setup puts focus on whether past links between stablecoin liquidity and ETH’s relative strength versus Bitcoin re-emerge this cycle.

Corporate Ethereum reserves have climbed to $16 billion, with strategic holders controlling 7.33 million ETH—about 6% of total supply. In May, Ethereum ETFs saw roughly -$300 million in net flows, a shift that has pressured sentiment and coincided with an around 8% monthly decline in ETH.

Bitcoin fell below $77,000 over the past 24 hours, pressuring treasury-linked stocks such as MicroStrategy (MSTR), which dropped about 3% as risk-off sentiment spread. Peter Schiff criticized MSTR on X over its roughly $64 billion Bitcoin exposure, while the BTC/gold backdrop and Bitcoin ETP flows continued to show relative strength versus gold.

U.S. equities have pushed to new all-time highs, with the S&P 500 up +18% over the past eight weeks, while crypto has lagged with total market gains of about 10%. Bitcoin saw a near 10% drop in under two weeks and slipped below $77k as roughly $60 billion left the crypto market and the Fear & Greed Index fell back into “fear”. The split, however, may still leave room for a rebound if volatility cools and risk appetite stays supported by strong stocks.

Sui has introduced protocol-level gasless stablecoin transfers, allowing peer-to-peer payments in supported stablecoins without users needing to pay gas fees or hold a SUI balance. The rollout includes USDsui, SuiUSDe, USDC, and USDY, as the network continues to frame stablecoins as a core part of its payments strategy.

A Federal Reserve report says 10% of Americans used cryptocurrency in 2025, the highest share since 2022, while overall crypto still finished 2025 down 7.85%. The same report suggests most usage remains tied to investing or trading rather than payments, with only small shares using crypto for transactions where normal banking services are available.

Bitcoin is facing renewed downside pressure as short-term holder indicators weaken and U.S.-Iran strike concerns lift oil toward $110 per barrel. ETFs opened the week with nearly $650 million in net outflows after $1 billion+ redemptions last week, with ARKB and IBIT each seeing about $310–$324 million leave. Despite heavier selling, sentiment gauges have rebounded from fear to neutral, keeping the capitulation case unresolved.

As the CLARITY Act edges toward becoming law, Ethereum is being framed as a leading beneficiary based on a five-point decentralization checklist. Yet reported Q1 institutional trimming—JPMorgan (-89%), Fidelity/FMR (-84%), Goldman Sachs (-62%), and Royal Bank of Canada (-39%)—alongside softer DeFi signals, suggests expectations may be outpacing positioning.