Former Bankless member Lucas remains bullish on Ethereum amid market doubts.

Original author: Lucas, former Bankless member

Saoirse, Foresight News

Core Summary:

• All assets will be tokenized in the future;
• Ethereum serves as the settlement layer for various tokenized assets;
• ETH secures network security through staking and captures all value generated from settlement services;
• The global financial system as a whole is transitioning toward asset tokenization;
• Leveraging its security, stability, and long-established ecosystem advantages, Ethereum will capture a large share of the tokenization market.

In today’s crypto social platforms, market pessimism toward Ethereum has reached historic lows. Many longtime colleagues have gradually exited the Ethereum space, with some leaving the crypto industry entirely; most no longer hold ETH, primarily because they no longer recognize its investment value. This is not directed at any individual or subgroup—it is a widespread reality I have witnessed firsthand within the industry.

Large-scale capital outflows are driven by two factors: first, cryptocurrencies are no longer the cutting-edge hot technology, having been replaced by artificial intelligence, robotics, and longevity research as the preferred targets of capital; but the primary catalyst for market bearishness is the poor returns resulting from ETH’s weak price performance. Simply put, holding ETH over the past few years has been an extremely disappointing experience.

I remain strongly bullish on Ethereum and ETH, with more confidence than ever before, and I encourage readers to share this bullish outlook. In fact, Ethereum is entering its most anticipated period of adoption and growth in its history.

First, address the most obvious issue: Over the past nearly five years, ETH’s price performance has been dismal. Investors who entered and held in 2021 have, at best, broken even; most are deeply underwater. Even as the broader market has recently corrected, Bitcoin’s current price remains firmly above its 2021 bull market peak, and its 2025 high was more than double that level. In contrast, ETH’s current price is down approximately 60% from its previous all-time high, failed to reach a new peak in 2025, and hasn’t even broken the $5,000 mark.

The S&P 500 index nearly set new all-time highs every day, while stocks in Wall Street’s hot sectors—AI, semiconductors, and energy—surged sharply; in contrast, ETH’s performance looked even more disappointing.

The good news is that, when viewed over a longer time horizon, ETH’s price has merely been trapped in a multi-year trading range. With a current market capitalization exceeding $200 billion and a price that has consistently held above $2,000, Ethereum remains firmly among the top 100 assets by market value worldwide. Throughout the history of capital markets, it is common for high-quality growth assets to undergo several years of consolidation before entering a prolonged bull market.

Ignore the percentage change value; the focus is on measuring how long the price remained within this range.

Global giants such as Amazon, NVIDIA, Apple, and Microsoft have all gone through the same journey:

• Amazon: Bezos led the company through nearly a decade of stagnation following the dot-com bubble burst in the 2000s, emerging as a global leader after weathering the industry winter.

• NVIDIA: After seven years of prolonged consolidation during the 2010s, it experienced an unprecedented stock price surge fueled by the AI wave, entering the top tier of global market capitalization.

• Apple: Experienced prolonged uncertainty and volatility from the 1980s to the 1990s; only began its rapid growth after Jobs returned to the company in 1997.

• Microsoft: After 2000, its stock price remained flat for approximately 15 years; investors who entered in 2000 did not break even until 2015, and it is now the second-largest company by market capitalization globally.

It’s not difficult to identify the pattern: the world’s top assets typically undergo long, tedious periods of consolidation, with some briefly surging to new highs before falling back again, waiting for industry catalysts to ignite the next bull market. During these consolidation phases, the broader U.S. stock market often continues to reach new highs. Within this framework, ETH’s weak performance over the past five years is not unusual by financial history standards.

Setting aside market price, Ethereum’s current fundamentals are actually at their historical peak.

According to market pessimism, a weakening market inevitably leads to a decline in on-chain activity: falling transaction volumes, high fees, and stalled real-world applications. However, the actual data shows the exact opposite. On-chain transaction volume on Ethereum has been steadily rising, fees have reached new阶段性lows, and the pace of asset tokenization adoption continues to accelerate.

Data source: Etherscan

Based on Etherscan data: In May 2026, Ethereum’s daily transaction volume reached 2.27 million, setting a new all-time high; during the same period, the average transaction fee was only $0.27, a significant reduction compared to the $50–$100 gas fees commonly seen during the 2021 bull market, despite transaction volume doubling.

The total number of on-chain addresses has surpassed 400 million, with an average daily growth rate of approximately 0.08% in 2026, and daily active on-chain users have consistently exceeded 1 million in recent months. At the current growth rate, and without significant industry catalysts, Ethereum’s total address count may surpass 1 billion by mid-2029.

Staking levels continue to set new records: over 32% of all ETH on the network have been staked, continuously safeguarding network security.

Data source: validatorqueue.com

In summary, Ethereum has successfully scaled while maintaining its commitments to decentralization and security. Over more than a decade of operation, it has never experienced a full-network outage. With its extreme neutrality, robust security, and programmable block resources, Ethereum has secured the essential advantage needed to compete as the foundational infrastructure of global finance—this also serves as the prerequisite for the subsequent tokenization of vast amounts of traditional assets.

Since I entered the industry in 2017, my long-term thesis on Ethereum has remained unchanged:

• All tangible assets in the world will eventually be tokenized;
• Ethereum becomes the unified settlement layer for all types of token assets;
• ETH captures the value increment generated by all business on the settlement layer.

Over its first decade, Ethereum primarily served as a testing ground for crypto-native assets, giving rise to industries such as DeFi, NFTs, and meme coins, thereby solidifying the foundation of its underlying ecosystem; in the next phase of development, Ethereum will embark on a new journey toward a trillion-dollar market capitalization.

For seasoned crypto-native players, the tokenization of traditional finance may seem mundane, but it is an essential step toward mainstream adoption and deserves industry-wide support. In the future, the vast majority of the $700 trillion in global traditional real-world assets will ultimately be tokenized on-chain, with Ethereum serving as the preferred underlying network.

Many argue that Ethereum’s scalability is insufficient to handle massive assets and that other blockchains will capture market share. However, current on-chain data has already disproven this view: traditional financial institutions are increasingly integrating into the Ethereum ecosystem.

Over the past two years, a series of headlines have noted that they share a common trait.

The core concern for institutional entry is certainty: banks, asset managers, and clearinghouses choosing blockchain to custody trillions in assets represent major strategic decisions—they must seize the benefits of tokenization while avoiding career risks from poor decisions.

Of course, public blockchains like Hyperliquid and Solana can also share in the market—the tokenization sector is large enough to support the co-development of multiple blockchains and cannot be monopolized by a single one. However, traditional institutions seeking stability will prioritize Ethereum when implementing RWA.

Data validation supports the view: stablecoins are the first tokenized real-world assets to achieve product-market fit, with a total circulating market cap exceeding $300 billion. Tom Lee has referred to stablecoins as the crypto industry’s “ChatGPT moment,” with Ethereum accounting for 54% of the total stablecoin market cap.

Data source: rwa.xyz

As of June 1, 2026, the total value of tokenized real-world assets (RWA) across all categories surpassed $30 billion, with the sector experiencing a steep upward growth trajectory; over 53% of RWA assets are deployed on the Ethereum blockchain. Even as other blockchains start from scratch to compete for non-stablecoin RWA market share, Ethereum continues to maintain a dominant position.

Data source: rwa.xyz

The current stage of the RWA sector is comparable to the embryonic phase of DeFi in 2019–2020: the new sector’s logic is clear, and early data is steadily rising. Reviewing historical data from DefiLlama, total DeFi TVL experienced exponential growth in the first half of 2020, while ETH’s price remained in prolonged sideways consolidation at the time.

When the DeFi bull market fully erupted and yield farming became wildly popular, ETH was held back by the impact of the COVID-19 market conditions, with its market cap hovering at only $20–25 billion—ten times lower than its current $230 billion market cap. Meanwhile, the newly launched BNB Chain briefly threatened Ethereum’s dominance by offering significantly lower transaction fees. It wasn’t until DeFi assets accounted for approximately 20% of Ethereum’s total market cap that ETH began its rally from $300, surging to $4,000 by year-end and entering a super bull market.

Compared to now: After excluding stablecoins, the total value of non-stablecoin RWA on Ethereum is approximately $16 billion, accounting for only 7% of ETH’s total market cap. This places it at a stage analogous to the early infancy of DeFi, but with an overall scale ten times larger: DeFi began at $3 billion, while RWA is now starting at $30 billion; ETH’s low point was once $200, and now it’s $2,000; the competition back then was BNB Chain, while today it has shifted to Hyperliquid.

Additional note: In the early days, DeFi generated significant buying pressure on ETH due to collateral demands, and NFTs further reinforced the narrative of ETH as digital gold. However, at that time, Ethereum had not yet implemented the POS staking mechanism or the EIP-1559 burn mechanism. Now, both rules are fully in place, and every on-chain transaction directly contributes to ETH’s deflationary pressure and value support.

Projecting a tenfold expansion, the total size of this cycle’s RWA (excluding stablecoins) is expected to surpass $1 trillion. The U.S. CLARITY Act is a key catalyst; according to Polymarket data, there is approximately a 55% probability the bill will be enacted by 2026. Its passage will establish a compliant pathway for connecting all U.S. financial assets to the blockchain, serving as a major boost for Ethereum.

Stocks, bonds, commodities, real estate, art, intellectual property—any asset with value will ultimately be tokenized; this is the next major innovation in global finance.

Over the first two decades of the crypto industry, the focus was on the issuance and innovation of crypto-native assets; over the next two decades, the industry’s focus will shift to tokenizing traditional real-world assets.

Even though the current crypto sentiment is broadly bearish on Ethereum, I remain confident that Ethereum will become the foundational layer for the vast majority of tokenized assets worldwide. Leveraging its long-established advantages in security, reliability, and liquidity, Ethereum’s edge cannot be replicated in the short term. Once a massive volume of global assets are deployed on Ethereum, the market will inevitably reprice ETH, mirroring the explosive valuation surges of the past.