Ethereum Onboards 4 Million New Users—Here’s Why It Might Not Last

Ethereum’s network just added 4 million fresh wallets—but don’t pop the champagne yet. Growth spikes look great on PowerPoint slides, but retention? That’s where the real crypto battle happens.

The Onboarding Mirage

New addresses don’t equal sticky users. Speculators, airdrop hunters, and yield farmers flood in during hype cycles—then vanish faster than a meme coin’s liquidity.

The Retention Reality Check

High gas fees and clunky UX still throttle real adoption. Until Ethereum scales like it promised in 2017, these ’users’ are just tourists with MetaMask souvenirs.

Wall Street’s probably already pitching an ETH ’user growth’ ETF though—because nothing sells like a big number and a side of hopium.

Source: X

The rise of short-term investors acts as a market catalyst for Ethereum. Periods of significant price increases often align with the number of traders surpassing 4 million, indicating that short-term interest drives these rallies.

High demand from new small traders boosts prices, while numbers below 4 million lead to difficulty in sustaining price uptrends and often result in declines.

For example, in December 2024, when traders exceeded 4 million, ETH prices surged past $4,000, whereas in February 2025, the price fell as traders began to leave.

This trend suggests that 4 million traders is a key threshold for short- to medium-term price movements.

Having said that, the growing presence of speculative traders does raise one concern: Are they sticking around?

Although Ethereum short-term investors are rising again, hitting 4 million, the altcoin’s Ethereum’s Monthly Cohort Retention Rate has steadily declined.

A declining retention rate implies that fewer users are returning month over month after rejoining. This leads to lower user engagement.

Therefore, this is the major problem that Ethereum has been facing. When these new investors enter the market, they exit the market.

Source: Artemis

At the same time, Exchange Netflow spiked to 88.2K—its highest in three weeks—signaling a surge in ETH deposits onto centralized platforms.

This suggests that traders are aggressively exiting the market with more inflows than outflows.

Source: CryptoQuant

Can ETH reclaim $2.8K?

For now, Ethereum trades just under $2,700. If short-term demand holds and net selling cools off, ETH could target $2.8K, followed by $3,000.

However, if retention continues to drop and exchange inflows persist, ETH may lose momentum and slide back toward $2,448.