Ethereum Surges 33.47% in Q2 2025 Driven by Staking Boom

Ethereum has made a significant comeback in the second quarter of 2025, posting a 33.47% gain. This surge has reignited hopes that the cryptocurrency could reach the $4,000 mark by October. The momentum is driven by a surge in staking activity, with over 35 million ETH, or nearly 30% of the total supply, now staked. This indicates a growing confidence and long-term commitment from users to the Ethereum network.

However, the increasing engagement with Ethereum has also raised concerns about validator centralization. Lido, Binance, and Coinbase collectively control nearly 40% of all staked ETH. This level of concentration poses risks to the network's security and decentralization, as a single event affecting these entities could disrupt a significant portion of new blocks.

Ethereum's Q2 performance is one of its strongest in recent years, trailing only the gains seen in 2020 and 2019. As the third quarter begins, the community is approaching with cautious optimism, eyeing a potential rally toward $4,000 by late October. On-chain engagement has also hit all-time highs, with weekly active addresses crossing 20.2 million in May 2025, a 52.71% increase from the previous week.

The shift toward a stake-secured model has reached a major milestone, with over 35.2 million ETH, or about 28.3% of the total supply, now staked. This represents more than $84 billion at current prices. The spike in staking activity intensified in June, with over 500,000 ETH staked in just two weeks. This wave follows guidance from the U.S. SEC, which eased institutional hesitation.

With around 19% of ETH held long-term, Ethereum’s circulating supply is shrinking, leading to tighter markets and increased price swings. The growing scarcity of liquid staking tokens like stETH is pushing up borrowing costs on DeFi platforms, highlighting increased risk and reduced flexibility across Ethereum’s broader financial ecosystem.