Summary Ethereum is reaching a pivotal moment as PeerDAS and zkEVMs move into live implementation, positioning the network to practically resolve the blockchain trilemma. The core debate now is how Ethereum’s growing usage and ultra-low gas fees translate into sustainable value capture for ETH as an asset. Zcash’s core developers have left Electric Coin Company after a governance dispute with the Bootstrap nonprofit, triggering a near-20% ZEC sell-off despite no change to the protocol itself. Ledger’s recent data leak, while not compromising wallets or private keys, exposes users to heightened social engineering and even physical “wrench attack” risks. Ethereum Approaches a Turning Point in Solving the Blockchain Trilemma Ethereum ( ETH-USD ) is nearing a turning point as two critical upgrades, PeerDAS and zkEVM, transition from research concepts into live implementations. Working together, these two new advances aim to solve the famous blockchain trilemma that every blockchain has been struggling to balance. The blockchain trilemma refers to the challenge of achieving decentralization, security, and scalability at the same time. Most blockchains can optimize for only two of these three properties, but not all three simultaneously. Highly decentralized networks with strong security, such as Bitcoin ( BTC-USD ), sacrifice throughput, while high-performance blockchains often rely on a more centralized structure. For Ethereum, the new PeerDAS, which is already live on mainnet, enables nodes to verify data availability without downloading the entire dataset. By sampling a small portion of data, light clients can independently confirm availability. On the other side, zkEVM verifies Ethereum transactions off-chain and submits cryptographic proofs on-chain. This allows large amounts of computation to be validated efficiently with minimal data. Vitalik Buterin argues this combination could transform Ethereum into a network that distributes verification work across the system instead of forcing every node to replicate everything, thus solving the blockchain trillemma, having all three: decentralization, security, and scalability, at once. Key Take Ethereum underwent significant internal restructuring in 2025, including leadership changes at the Ethereum Foundation and the appointment of Aya Miyaguchi as president. The Pectra hard fork in May introduced EIP-7702 for account abstraction and increased the maximum validator stake limit, while the Fusaka upgrade in December featured PeerDAS to scale Layer 2 throughput and positioned Ethereum for decentralized AI systems. The year also saw accelerated privacy research and the raising of the block gas limit to 60 million. Ethereum has made substantial progress on the technical front as a decentralized platform, with Layer 1 and Layer 2 scaling significantly improving performance and usability. Recent data indicates Ethereum's mainnet activity has reached record highs, including a new L1 peak of 2.2 million transactions processed in a single day. The central concern, however, is no longer whether Ethereum is useful, but whether economic value ultimately accrues to ETH as an asset. As scaling expands across both layers, execution costs have collapsed, Ethereum gas fees are now at extremely low levels, with recent trackers showing average gas prices around 0.04 Gwei, raising important questions about long-term value capture for ETH despite growing network activity. ZCash Core Developers Resign, Triggering Market Sell-Off The core development team of ZCash ( ZEC-USD ), which is responsible for many of the network's key upgrades, announced it had separated from its longtime nonprofit sponsor, Bootstrap, and left Electric Coin Company to establish a new company. The decision led to a sharp market reaction, with ZEC declining by almost 20%. ECC (Electric Coin Company) was the for-profit company that employed the developers and historically led Zcash’s core development. Bootstrap is the nonprofit entity created to support and oversee the Zcash ecosystem, including governance and funding oversight. The separation followed a dispute over governance and strategic direction. The former leadership of Electric Coin Company is experiencing fundamental disagreements with Bootstrap's board regarding control, decision-making authority, and the potential privatization of the Zashi wallet. Developers argued that the nonprofit's governance structure had become overly restrictive and misaligned with Zcash's original mission. Despite the market volatility, there is little change operationally; the same development team will continue to build on Zcash under a new corporate structure, and the Zcash network is an open-source, permissionless blockchain. Key Take ZEC’s price reaction may be overdone. While the governance split triggered a sharp sell-off, the core Zcash protocol remains unchanged, and the same development team will continue building under a new structure However, this is another high-profile governance conflict just weeks after the Aave ( AAVE-USD ). In December 2025, Aave's community and its core development team were in a sharp dispute, and escalated into a broader governance battle over revenue rights, brand control, and the balance of power. In Aave’s case, the governance conflict was triggered by up to $10 million in annual revenue being redirected without explicit DAO approval, while in Zcash’s case, a 700%+ surge in ZEC over the past year dramatically raised the stakes around control and future development. When real monetary value and economic interests become significant, long-standing governance tensions that once seemed manageable are now surfacing as open conflict. Ledger Data Leak Exposes Users to Social Engineering Risks Ledger, the maker of one of the most widely used crypto hardware wallets, confirmed that customer data was exposed in a breach linked to its third-party e-commerce partner, Global-e, renewing concerns about user safety. While Ledger stated that private keys, wallet funds, and payment information were not compromised, the leak included names and contact details of customers who purchased devices through its online store. Who is at risk? The primary risk from this breach is not a technical compromise of hardware wallets, but social engineering. Attackers do not need to break Ledger’s cryptography; they only need to know who owns a hardware wallet. With access to real names, contact information, and purchase context, scammers can launch highly targeted phishing emails, SMS messages, or fake support calls. Security experts warn that once an individual is identified as a hardware wallet user, they become a long-term target for impersonation scams, recovery-phrase theft, and psychological manipulation. In short, the danger lies not in hacked devices, but in leaked identity data that enables attackers to target users directly. Key Take The most serious concern raised by the Ledger data leak is the risk of so-called “wrench attacks,” physical coercion used to force crypto holders to surrender funds. When attackers can link real-world identities to hardware wallet ownership, the threat moves from inboxes and phone calls into the physical realm. One of the most high-profile wrench attack cases in 2025 involved the kidnapping and physical intimidation of Ledger co-founder David Balland and his wife in France, where attackers held them for ransom and used extreme violence to try to coerce compliance. If attackers know your name and contact details, the best defense against physical attacks is to reduce certainty, immediacy, and perceived payoff. Physical attacks rely on confidence that value can be quickly extracted, so maintaining a low profile, minimizing real-world signals, and reducing location visibility significantly lowers the risk. Weekly Market Chart: Ethereum's High Usage, Low Fees Ethereum’s daily transactions are reaching new all-time highs in early 2026, but gas price is falling to extremely low levels at the same time. When Ethereum introduced EIP-1559, which burns part of the gas fee and removes ETH from circulation with every transaction, the prevailing narrative was “ultra sound money,” an asset with strong demand and a supply that could shrink over time. However, the current reality clearly demonstrates the failure of the "ultra sound money" narrative. With both Layer 1 and Layer 2 scaling dramatically reducing execution costs, Ethereum gas fees, and therefore ETH burn, have fallen to historically low levels. As a result, ETH issuance currently outpaces the amount of ETH being burned, meaning the supply is net inflationary rather than deflationary. This highlights a growing disconnect between Ethereum’s technical success in scaling and the economic conditions required for sustained ETH scarcity. Source: Etherscan & YCharts Disclaimer: The information provided herein does not constitute investment advice, financial advice, trading advice, or any other sort of advice, and should not be treated as such. All content set out below is for informational purposes only. Original Post
