Summary Ethereum is seeing year-over-year growth in users and transactions. Though fees continue to decline broadly. From a valuation standpoint, Ethereum's 1,400x fees multiple puts ETH near its all-time high P/F valuation. MCap/TVL is a bit better at just over 5x. While still totally dominant in the ETF market, ETHA isn't a 'buy' until the SEC allows for asset staking. It has been a couple of months since I've provided a monthly recap for Ethereum ( ETH-USD ) via Seeking Alpha. Specifically for the iShares Ethereum ETF ( ETHA ), you'd have to go back all the way to March to find my most recent piece . Back then, I focused primarily on the organic bid for Ethereum as the gas token of the cryptocurrency market. I concluded that despite positive signs in usage, the lack of fees was a potential problem for price: Like many others who buy digital assets, my view has generally been that ETH is the 'digital gas' of the cryptocurrency market. With this view in mind, it's important for the fundamental thesis that the network generates fees. This keeps an organic bid on the token and also creates the burn mechanism, which reduces inflation. Thus, Ethereum's quickly eroding fee market even as secondary layers scale the network is making it increasingly difficult to justify ETH as an investment at this point in time. As fate would have it, ETHA has rallied more than 40% since that article. In this update, we'll again look at Ethereum's network usage. To be sure, there are positive signs there. We'll also look at the capital flow story since it is such an important part of what is driving demand for the token. And we'll get into valuation of the asset relative to fundamentals. Network Activity Through November 2025 In many ways, November 2025 was a continuation of a longer-term trend that we've witnessed on the Ethereum blockchain going back to the 'Dencun' upgrade. Network fees continue to go down as the average user fee paid for each transaction continues its slide down to just 51 cents per: November 2024 October 2025 November 2025 YoY MoM DAAs (000s) 400.5 490.6 483.7 20.8% -1.4% Transactions 36.7 48 45.7 24.5% -4.8% Fees $191.60 $41.40 $23.60 -87.7% -43.0% Avg Tx Fee $5.15 $0.84 $0.51 -90.1% -39.3% Source: Token Terminal, Transactions and Fees in millions Year-over-year, average transaction fees are down by 90%, which is very much in line with the decline in total network fees at 88%. The good news is daily active addresses hit 483k in the month. This was a 21% year-over-year increase, though a slight dip from October. Transactions hit 45.7 million in November; again, a noticeable 24.5% increase from November last year. DAAs and transactions each hit record highs back in August but have since pulled back slightly. Still, both metrics are above long term averages. Aiding this surge in transactions has been Ethereum's continued dominance in the stablecoin market. At the end of November, Ethereum accounted for over $171 billion of the market's $304 billion total supply. More importantly, Ethereum is seeing its share of stablecoin volume grow: Stable Tx Vol ($b) November 2024 October 2025 November 2025 YoY MoM Total Market $2,900 $7,300 $5,700 96.6% -21.9% Ethereum $858 $2,700 $2,500 191.2% -7.4% ETH Share 22.84% 27.00% 30.49% 33.5% 12.9% Source: Artemis Where companies like Circle Internet Group ( CRCL ) benefit from growth in stablecoin supply, Ethereum generated revenue from the actual usage of those coins, not from the yields from T-bill collateral. In November, Ethereum's $2.5 trillion in stable transaction volume was good for 30.5% of the total market. This was 33.5% year-over-year growth in transaction volume share. And it isn't just Ethereum that has seen this kind of growth: Stable Tx Vol by Chain (Artemis) Layer 2 networks like Base have also seen their share of stablecoin transaction volume grow year over year, from 18.7% last November to 22.5% this November. Base is actually now the second largest blockchain network by stablecoin transaction volume. DAT & ETF Flows Usage growth aside, capital flows have generally been the biggest driver of returns in the digital asset market since the approval of spot ETFs last year. Compared with other assets in the market, ETH's share of capital flows in 2025 has been stellar: Asset (mil) MTD Flows YTD Flows AUM Bitcoin ( BTC-USD ) -$2,810 $26,783 $142,662 Ethereum -$1,397 $12,893 $25,512 Multi-asset $37.2 $1 $7,104 Solana ( SOL-USD ) $101.7 $3,389 $3,454 XRP ( XRP-USD ) $785.4 $2,890 $3,129 Total -$3,223 $46,105 $183,345 BTC Dominance 87.2% 58.1% 77.8% ETH Dominance 43.3% 28.0% 13.9% Source: CoinShares, Bloomberg as of 11/28/25 While Ethereum's 28% share of 2025 investment flows is far from Bitcoin's 58%, it is a large improvement over the 13.9% share of AUM. November was a difficult month for both assets, with a combined outflow of over $4 billion between the two. Lower market cap tokens did a bit better. From a DAT perspective, November was a month of holdings growth, though that growth has slowed considerably over the last several months. ETH ETF + DAT Holdings (StrategicETHReserve) At the end of November, ETH DATs held 6.4 million ETH, which was up slightly from the 6.1 million ETH at the end of October. However, this didn't quite make up for the roughly 425k ETH that came out of the ETFs. Combined DAT and ETH supply has been generally flat since mid-October. Valuation From a valuation perspective, we have a clear case of multiple expansion judging by the circulating price-to-fees ratio: Ethereum Circulating P/F Multiple (Token Terminal) At just under 1,400x fees, Ethereum is almost as expensive as it has ever been. I personally like the P/F ratio because I see it as a reasonable comp for an equity price to sales multiple. In the past, we've seen the coin grow into these types of extended multiples. The fact that usage is growing is a good sign. But still, ETH is not 'cheap' at these levels. Network DeFi TVL MCap/TVL Ethereum $71.0b 5.4 Solana $9.2b 8.7 BSC ( BNB-USD ) $7.1b 17.5 Source: DeFiLlama That said, viewing the coin through a DeFi TVL ratio tells a slightly different story. At $71 billion in TVL, Ethereum's market cap to TVL ratio is just 5.4. This is much lower than peer L1 networks and leaves the valuation interpretation up to each individual investor's preference. To be clear, I like fees better because I see Ethereum as essentially a settlement layer for digital commerce and tokenization. Thus, fees are an important input for Ethereum's fundamentals. iShares Ethereum ETF ETHA continues to be the monster in the Ethereum ETF market. ETF ETH Share (TheBlock) At 48% of the market supply, ETHA has been the clear winner in the Ethereum ETF game to this point. The fund's share of volume is even higher at roughly 70%. At just 25 basis points, ETHA is among the cheapest spot ETH ETFs in the market. However, unlike Grayscale's flagship ETH fund, ETHA has not yet been cleared by the SEC for asset staking. Until that happens, it's difficult for me to call the fund a better 'buy' than funds that do offer staking yields. Closing Summary I continue to believe ETH is an important part of the broader blockchain ecosystem, and any digital asset portfolio should include an allocation to the token and/or proxies of the token. While I'm certainly not of the view that Ethereum is cheap at 1,400x fees, history shows that ETH generally grows into its valuation through usage growth. So far, we're seeing growth in transactions and users in 2025. Yet, the fees are not quite there. The network has a sizable lead in stablecoins, which I view as another reason to be long the token in some way. While I like other opportunities better than ETHA specifically, assuming the fund is allowed to enable staking at some point in the future, it is definitely one to consider for long-term holding.
