Public sentiment on Ethereum has cooled to levels some analysts compare to the period before last year’s massive rebound, but experts say that doesn’t automatically mean another large rally is coming.

Sentiments reflect past lows

According to Santiment analyst Brian Quinlivan, social media sentiment is OK Ether has declined and is now near the lower range seen ahead of the 2025 rally.

Quinlivan suggested that the drop in call volume “argues that we don’t want to go further down” and pointed out that the price often rose as a result of forceful public doubt.

On August 23, Ether hit a up-to-date all-time high of around $4,900, following a rebound from its April low near $1,470, based on CoinGecko data.

This escalate has pushed the token back above its 2021 high. Since then, Ether has retreated approximately 36% from its peak and was trading at $3,089 at the time of reporting.

Market shock and liquidity events

Reports have revealed that the massive liquidation on October 10 resulted in nearly $20 billion in losses in the cryptocurrency market, and the event is linked to the recent withdrawal. Many positions were liquidated, followed by a broader risk-off mood.

Crypto fear rates were low. One index observed a Fear score of 29 on Sunday, while the Altcoin Season Index shows a Bitcoin Season score of 34 out of 100 – a reading that indicates that money has been flowing into Bitcoin, not altcoins, over the past 90 days. This combination of indicators is closely watched by traders who adjust their position sizes according to changes in sentiment.

Network activity and interest

Quinlivan also highlighted signals in the chain that he sees as positive. According to him, activity on the Ethereum network is growing, and staking is attracting more and more attention from users.

Increasing throughput is safer than reducing latency

With PeerDAS and ZKP, we know how to scale and can potentially scale thousands of times compared to the status quo. The numbers are becoming much more favorable than before (e.g. see the analysis here, before and after fragmentation…

— Vitalik.eth (@VitalikButerin) January 8, 2026

Meanwhile, Vitalik Buterin joined the public discussion on technical issues improvements. Buterin said in an extended post on X that PeerDAS, which arrived with the Fusaka update, along with zero-knowledge verification and sharding, will push Ethereum towards much higher throughput.

He added that Layer 2 networks such as Base, Polygon and Optimism will continue to be needed because many apply cases require speeds even faster than the mainnet.

Institutional views and market positioning

Based on reports, Coinbase Asset Management CEO Anthony Bassili said in November 2025 that investors prioritize Bitcoin first and Ethereum second when building a core portfolio.

This stance reflects how many immense investors now treat Ether as the default market capitalization asset number two, rather than as a side bet. With this status, downside expectations may be lower than for riskier tokens. Still, sentiment can remain low for a long time, and a high ranking doesn’t eliminate volatility.

Featured image from Unsplash, chart from TradingView