The cryptocurrency market witnessed a significant event in mid-September: Ethereum (ETH) experienced a notable price surge, climbing nearly 20% within a week. While Bitcoin remained relatively stagnant around the $10,000 mark, ETH broke through $200, leaving many investors curious about the reasons behind this independent rally.
Behind the price movement lies a fundamental shift—Ethereum is becoming more usable and actively utilized. Since August, key on-chain metrics have shown substantial growth, driven largely by increased stablecoin transactions and the rapid expansion of decentralized finance (DeFi) applications.
This article explores the factors contributing to Ethereum's resurgence, from growing network adoption to technical upgrades on the horizon.
Increased Network Utilization Drives Value
Ethereum’s blockchain has seen a significant uptick in usage since late summer. According to data from blockchain analytics platform Gikee, daily active addresses on the Ethereum network reached 380,000 in late August, while addresses participating in transactions peaked at 430,000—both setting new records for the year.
As of September 19, the total number of Ethereum addresses stood at 68 million. By comparison, EOS—often touted as a high-performance competitor—had only 5.6 million addresses, roughly equal to the number of new Ethereum addresses added since August.
This growth isn’t accidental. More users and transactions mean higher demand for block space, which in turn increases the value of ETH, the native currency required to pay transaction fees (known as Gas).
Stablecoins: Major Contributors to On-Chain Activity
One of the biggest drivers of Ethereum’s increased transaction volume is the rising use of stablecoins, particularly Tether (USDT). Earlier this year, Tether began shifting the majority of its USDT issuance from the Omni protocol to the Ethereum ERC-20 standard.
On September 12, an additional $300 million in USDT was migrated from Omni to Ethereum, bringing the total supply of ETH-based USDT to $1.9 billion—roughly 45% of all USDT in circulation.
But Tether isn’t the only stablecoin leveraging Ethereum’s network. Of the top ten stablecoins by market capitalization, seven are built on Ethereum. These high-liquidity assets generate a constant flow of transactions, contributing significantly to network activity and Gas consumption.
With Ethereum’s current transaction throughput limited to around 20–25 transactions per second (TPS), rising demand has occasionally led to network congestion. In response, miners have approved raising the Gas limit to accommodate more transactions per block—a sign of growing utility and adoption.
DeFi Brings New Life to Ethereum DApps
While initial coin offerings (ICOs) were Ethereum’s first killer application, the recent boom in decentralized finance (DeFi) has emerged as a new source of growth.
Last year, many developers turned to building gambling-related DApps on networks like EOS and Tron, leading some to dismiss most blockchain applications as mere casinos. Ethereum, with its slower transaction speeds, was largely left out of this trend—so much so that some commentators began declaring Ethereum “dead.”
By early this year, ETH had fallen to around $100, down more than 90% from its all-time high. Competing platforms like EOS and Tron marketed themselves as more scalable alternatives, and even major exchanges like Binance and OKEx announced their own blockchain initiatives.
But the narrative began to shift in the second half of the year. The rise of DeFi applications—including decentralized exchanges (DEXs), lending platforms, and derivatives protocols—brought renewed activity to the Ethereum network.
Data from DAppReview shows that out of 22 major DeFi applications, 20 are built on Ethereum. While EOS hosts 618 DApps in total, Ethereum is home to nearly 2,000.
Not only does Ethereum have more applications, but its DApps also tend to have higher user activity. According to Spider Data, Ethereum-based DApps dominate the top 20 rankings in terms of 7-day active users, transaction count, and transaction volume.
Although some critics point out that Ethereum’s scalability issues can affect user experience—especially for trading-oriented DEXs—many DeFi projects still prefer Ethereum due to its stronger decentralization and security guarantees.
Ethereum 2.0: The Next Major Upgrade
Technical progress is also fueling optimism around Ethereum. Vitalik Buterin, Ethereum’s creator, recently announced that Ethereum 2.0—a multi-phase upgrade that has been delayed multiple times—is nearing completion.
The first phase of Ethereum 2.0 is already finalized pending security audits. Once launched, the network will transition from a proof-of-work (PoW) consensus mechanism to proof-of-stake (PoS). It will also introduce sharding, a scaling technique that aims to increase transaction throughput to around 3,000 TPS.
This upgrade is highly anticipated across the ecosystem. The team behind Newdex, a decentralized exchange originally built on EOS, has expressed interest in expanding to Ethereum once the network’s performance improves.
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Can Ethereum Lead the Next Bull Market?
With so many positive developments, some analysts believe Ethereum could be positioned to lead the next major bull run.
Crypto analyst Chen Chuci suggested that ETH has gone through three distinct phases in the first three quarters of the year: correction, rally, and consolidation. He believes the fourth quarter could see a renewed upward trend.
Not everyone is equally bullish. Quantitative analyst Ti Mahe recommends a more cautious approach, noting that while current signals support a long position, there is still a possibility of a larger correction that could offer better entry points.
Earlier this year, several well-known crypto investors predicted that a new bull market would begin in September or October. The strong performance of Ethereum and EOS at the beginning of September seemed to support this outlook.
However, the launch of Bakkt—a physically-settled Bitcoin futures platform widely expected to boost institutional adoption—disappointed many traders. Trading volume was minimal at launch, and Bitcoin’s price dipped slightly on the first day of trading.
While Bakkt’s debut didn’t immediately ignite a bull market, Ethereum’ strong September performance has given the market a renewed sense of hope.
Frequently Asked Questions
What caused Ethereum’s price surge in September?
Ethereum’s rally was driven by growing network usage, including increased stablecoin transfers and activity in decentralized finance applications. Technical progress on Ethereum 2.0 also contributed to positive sentiment.
How does Ethereum compare to other smart contract platforms?
Ethereum continues to host the largest number of DApps and DeFi protocols. While other platforms may offer higher transaction speeds, many developers choose Ethereum for its security and decentralization.
What is Ethereum 2.0?
Ethereum 2.0 is a major network upgrade that will transition Ethereum to proof-of-stake and introduce sharding to improve scalability. The upgrade is expected to significantly increase transaction capacity.
Can Ethereum’s growth continue?
While short-term fluctuations are always possible, the fundamental usage of Ethereum appears to be growing. The expansion of DeFi and the eventual launch of Ethereum 2.0 could support further adoption.
What are the risks of investing in Ethereum?
Like all cryptocurrencies, Ethereum is subject to high volatility, regulatory uncertainty, and technological risks. Investors should carefully assess their risk tolerance and conduct thorough research.
How can I stay updated on Ethereum developments?
You can follow official Ethereum blogs, community forums, and reputable crypto news outlets. For real-time data and analysis, consider using professional market tools.
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Ethereum’s revival is underway—not just in price, but in utility, adoption, and technological progress. As the network continues to evolve, it remains at the forefront of blockchain innovation.