L1s got absolutely pulverized this year. Prices collapsed hard, but was that really the end?
An analysis shared on the 25th of December by Schizoxbt showed severe underperformance across major Layer-1 tokens. Large-cap status offered little protection as multiple networks posted steep yearly drawdowns.
Ethereum ended the year down 15.3%, while Solana fell 35.9% over the same period. Avalanche and Sui declined 67.9% and 67.3%, respectively, reflecting sustained downside pressure.
TON recorded the sharpest drop, falling 73.8% during 2025. Only BNB and TRX posted gains, rising 18.2% and 9.8%, respectively, against broader weakness.
The data reinforced a harsh lesson for investors. Market capitalization alone did not guarantee resilience during provider risk-off conditions.
But price action told only part of the story.
Revenue and Fees: Did network monetization really weaken?
While token prices fell, on-chain revenue data painted a noticeably different picture. Token Terminal data showed activity remained heavily concentrated across a handful of Layer-1 networks.
Tron led all Layer-1s in revenue, generating approximately $3.5 B over the past 365 days. Ethereum followed with $305.3 M, while Solana generated roughly $206.8 M during the same period.
Fee generation showed a similar pattern. Solana led in fees with $699.9 M, while Ethereum recorded $549.3 M in cumulative fees.
BNB Chain also remained economically relevant, producing $260.3 M in fees despite muted price action. The consistency of suggested usage did not collapse alongside token valuations.
User activity: Were traders actually leaving Layer-1s?
Monthly active address data further challenged the bearish narrative surrounding Layer-1s. User activity remained elevated on networks, dominating transaction throughput.
BNB Chain led with 59.8 M active addresses, while Solana followed at 39.8 M. NEAR Protocol recorded 38.7 M, placing it firmly among high-usage networks.
Sei Network reported 10.6 M active addresses, rivaling Bitcoin at 10.3 M. Ethereum trailed slightly with 9.3 M, reflecting steady but slower growth.
The numbers suggested participation persisted even as prices corrected.
Fundamentals vs. price action
The divergence between prices and fundamentals became the defining theme of 2025. Layer-1 tokens appeared to undergo repricing rather than structural deterioration.
Losses deepened after many Layer-1s peaked near all-time highs in early October. The subsequent October sell-off accelerated downside momentum and amplified year-end drawdowns.
However, capital and activity consolidated around networks generating real usage, fees, and revenue. Speculative premiums faded, while economically productive chains retained relevance.
Final Thoughts
- The 2025 drawdown highlighted how Layer-1 valuations corrected sharply after October’s all-time highs.
- However, on-chain revenue and user data suggested the sector faced repricing pressure, not structural decline.
