Ethereum’s layer‑1 protocol recorded unprecedented usage levels in the first quarter of 2026, with monthly active users rising 53.5% quarter‑over‑quarter to 13.2 million and total transactions climbing to 200.4 million, even as ETH’s market cap slipped 30% and base‑layer fees dropped close to 50%.
Record‑Breaking Activity
Token Terminal’s Q1 2026 Ethereum Report, released on June 17, shows that every key usage metric surged. Monthly active wallets expanded 85.9% year‑over‑year, while transaction volume increased 81.5% YoY, surpassing the 200 million mark. Network throughput reached 25.78 transactions per second, an 81.7% YoY improvement, underscoring the blockchain’s growing appeal to investors.
Revenue Compression
Despite the usage boom, dollar‑denominated earnings fell sharply. The ecosystem’s total value locked averaged $316.2 billion, a decline of 11% from Q4 2025 but still 23% higher than a year earlier. Base‑layer transaction fees amounted to $39.9 million, representing a 48% quarter‑over‑quarter drop and an 81.9% decline from the same period in 2025.
Impact of the Fusaka Upgrade
The fee contraction aligns with the January rollout of the Fusaka upgrade’s second Blob Parameters Only fork (BPO #2), which expanded Ethereum’s data capacity and reduced blockspace costs. This technical shift propelled transaction numbers up 38% while slashing total fees by nearly half, highlighting how protocol enhancements can reshape crypto economics.