Ethereum Comeback Gains Momentum as Activity and Stablecoin Flows Return to L1

TLDR: Ethereum activity and stablecoin balances are shifting back from Layer 2 networks to the base layer Stablecoin supply and tokenized assets on Ethereum are approaching previous all-time high levels Ethereum’s execution density and composability continue to attract high-value on-chain transactions ETH has outperformed major Layer 2 tokens since October 2025, signaling renewed market strength Ethereum comeback narratives are gaining traction as new data points to renewed activity on the network. Insights shared by Coinbase Institutional indicate a measurable shift in user behavior and capital flows. Stablecoin balances and tokenized assets on Ethereum are approaching historical highs. At the same time, ETH has outperformed major Layer 2 tokens since October 2025, suggesting a change in market structure. Activity Returns to Ethereum’s Base Layer Recent observations show that users are gradually returning to Ethereum’s main network. Coinbase Institutional reported that both activity levels and stablecoin balances have tilted back toward Layer 1. This marks a shift from earlier periods when Layer 2 solutions captured a larger share of transactions. The same update noted that stablecoin supply on Ethereum is nearing record levels. Tokenized asset values are also rising toward previous peaks. These movements point to increased reliance on Ethereum for settlement and liquidity functions. Metrics tracking organic activity further support this trend. Execution density on Ethereum remains strong, reflecting higher economic value processed within limited block space. This indicates that users continue to prioritize efficiency and depth over lower transaction costs. Coinbase Institutional also stated that ETH has outperformed major Layer 2 tokens since October 2025. This relative strength aligns with growing on-chain activity and sustained liquidity inflows. The data was shared through its official X post, which framed the discussion around Ethereum’s evolving role. Is E...