JPMorgan warns: Ethereum’s Fusaka gains may be short-lived

JPMorgan warns that Ethereum's Fusaka upgrade brought only a short-term boost. Despite lower fees and higher usage, analysts doubt the sustainability of these gains due to ongoing structural challenges and competition.

JPMorgan has expressed concerns about the sustainability of Ethereum's recent surge in network activity following the Fusaka upgrade, completed in December 2025. The upgrade increased block data capacity, resulting in lower transaction fees and a notable rise in transaction volume and active addresses. However, analysts point out that similar spikes in activity have occurred after previous upgrades, only to normalize within weeks. The ongoing migration of users and applications to Layer 2 networks and competing blockchains like Solana continues to divert demand from the Ethereum mainnet, limiting its long-term growth prospects. Additionally, reduced speculative interest in NFTs and meme coins, along with the migration of major applications to dedicated chains, has led to capital outflows, decreased fee burning, increased ETH supply, and a drop in total value locked. While the Fusaka upgrade brought immediate technical improvements, JPMorgan remains skeptical that these gains will result in sustained network growth, citing persistent structural challenges and historical trends of short-lived activity boosts.