Ethereum’s DeFi ecosystem growth hasn’t driven price to new highs due to a mix of market saturation, competition, and external pressures. As of March 16, 2025, DeFi’s total value locked (TVL) on Ethereum exceeds $100 billion, per DeFiLlama, yet ETH hovers below its 2021 peak. Early DeFi booms fueled speculation, but now, mature projects prioritize utility over hype, diluting price momentum. Rival chains like Solana and Binance Smart Chain siphon TVL with lower fees, fragmenting adoption. Macro factors—rising interest rates and regulatory scrutiny—also dampen crypto enthusiasm, capping inflows. Gas fees, though reduced post-Merge, still deter small investors, limiting demand. While DeFi strengthens Ethereum’s fundamentals, price reflects sentiment and liquidity, not just ecosystem health. Thus, growth sustains relevance but struggles to ignite the speculative surges needed for new highs.

Ethereum's DeFi growth faces challenges from market saturation, competition, and external factors, hindering price surge. Despite TVL surpassing $100 billion, ETH lags behind 2021 highs. Mature projects prioritize utility over hype, while rivals attract TVL with lower fees. Macro issues like rising rates and regulations also weigh on sentiment. Gas fees, though lower, still deter small investors. DeFi boosts Ethereum's fundamentals, but price reflects sentiment and liquidity. Sustainable growth is key amid subdued speculative activity.