Post-Merge, Ethereum's total supply has increased beyond pre-Merge levels, as the transition to proof-of-stake from mining has resulted in greater issuance.

Historically, increased network activity has correlated with rising ETH prices, while lower fees have exerted downward pressure due to reduced demand.

Despite the current challenges, some analysts remain optimistic about ETH's potential recovery, noting signs that prices might bounce back towards key support levels.

Ethereum's price is currently exhibiting a bearish trend, with predictions suggesting a potential drop towards $1,200 after experiencing a significant decline from $3,432 on January 31 to a low of $1,750 by March 11, 2025.

Despite a recent 18% rebound, ETH has struggled to break the $2,000 barrier, reflecting ongoing weak market sentiment.

Recent price patterns indicate the formation of a bear flag, and a close below the $2,000 mark could trigger a further decline to around $1,230, representing a 40% drop from current levels.

The daily transaction count on Ethereum has fallen to levels not seen since October 2024, highlighting a significant reduction in network activity amid waning market confidence.

On March 24, Ethereum's average transaction fees plummeted to an all-time low of 0.00025 ETH, or approximately $0.46, indicating diminished demand for block space across decentralized finance (DeFi), NFTs, and decentralized applications (DApps).

The decline in transaction fees has contributed to a drop in Ethereum's burn rate, now projected at 25,000 ETH annually, leading to an inflation rate of 0.76% per year.