Ethereum News Today: Investors Balk at AI Crypto's Volatility Despite Long-Term Growth Hopes

The cryptocurrency market continued its downward spiral on Oct. 31, 2025, as AI-related tokens led a broad sell-off and Ethereum (ETH) dipped below $3,900 for the first time since mid-2024. The decline, which accelerated amid mixed signals about the sector's long-term viability, underscored growing investor skepticism about speculative assets tied to artificial intelligence and blockchain infrastructure.

The sell-off followed a report from Future Market Insights, which projected the cryptocurrency market will grow to $12.1 billion by 2035, a 12.6% compound annual growth rate. However, analysts noted that optimism is clashing with near-term volatility, as onchain revenue—a key indicator of blockchain adoption—reached $19.8 billion in 2025, according to a TradingView report. While the figure reflects a tenfold increase since 2020, it still lags behind the 2021 peak of $24.1 billion, highlighting uneven progress in maturing the asset class.

The AI-driven crypto segment has been hit particularly hard. C3.ai (AI), a provider of enterprise AI solutions, has seen its stock plummet 50% this year after founder Thomas Siebel stepped down as CEO in September. The company's recent quarterly revenue contraction—linked to Siebel's departure—has raised questions about its ability to maintain market leadership in AI adoption, as noted in a Motley Fool article. Meanwhile, BigBear.ai (BBAI), another AI-focused player, has rallied 160% since April despite a 22% revenue forecast cut in Q2 and a lack of topline growth over six months, according to Seeking Alpha. Analysts caution that the valuation surge defies traditional metrics, with the stock's fundamentals showing little improvement.

Ethereum's retreat below $3,900 marked a psychological threshold for the second-largest cryptocurrency. The decline came as dYdX, a decentralized exchange, announced plans to launch spot trading in the U.S. by year-end, prioritizing compliance over its signature perpetual futures contracts, according to a CryptoNewsZ report. The move reflects a broader industry recalibration as the Trump administration rolls out clearer crypto regulations, including the CLARITY Act and GENIUS Act, which aim to resolve jurisdictional disputes between the SEC and CFTC.

Despite the near-term turbulence, infrastructure developments are gaining traction. Bybit, the crypto exchange with 70 million users, expanded its partnership with Thredd to roll out a multi-currency crypto card, enabling real-time crypto-to-fiat conversion and integration with Apple Pay and Google Pay, according to a Blockchain Reporter report. The initiative underscores the industry's push to bridge DeFi and TradFi, a strategy that could stabilize adoption as retail investors seek more practical use cases.

The market's resilience, however, remains in question. While tokenized real-world assets (RWAs) have surged past $35 billion in value, excluding stablecoins, their fee-based growth is still nascent compared to traditional markets, as highlighted in that TradingView report. JPMorgan and BlackRock's forays into asset tokenization suggest institutional interest, but retail participation remains fragmented.