The year 2025 brought significant upheaval to the Layer-1 blockchain sector, with many tokens experiencing dramatic price collapses that left investors reeling. However, an in-depth analysis of on-chain data reveals a compelling paradox: while market valuations plummeted, the underlying economic activity and user engagement across these networks largely remained robust. This divergence suggests that the sector underwent a period of repricing and consolidation rather than a fundamental structural decline.
Price Action vs. Economic Relevance
Despite widespread market capitalization losses, the narrative of complete collapse doesn't tell the full story. Major Layer-1 tokens such as Ethereum, Solana, Avalanche, Sui, and TON saw steep yearly drawdowns, with TON recording the sharpest decline at 73.8%. Only BNB and TRX managed to post gains, rising 18.2% and 9.8% respectively, bucking the broader bearish trend. Yet, beneath this tumultuous price action, network monetization remained surprisingly strong. Tron emerged as a leader in revenue generation, securing approximately $3.5 billion, followed by Ethereum with $305.3 million and Solana with $206.8 million. Similarly, Solana led in fee generation with $699.9 million, closely followed by Ethereum and BNB Chain, indicating consistent economic activity despite falling token valuations.
Sustained User Engagement
Challenging the notion that users were abandoning Layer-1s, active address data highlighted persistent and elevated participation across numerous networks. BNB Chain led the pack with an impressive 59.8 million active addresses, demonstrating its continued relevance. Solana also showed strong user activity with 39.8 million active addresses, while NEAR Protocol positioned itself among high-usage networks with 38.7 million. Even networks like Sei, with 10.6 million active addresses, rivaled Bitcoin in terms of user engagement, and Ethereum maintained a steady 9.3 million active addresses. These figures collectively underscore that user activity and network utilization did not dwindle alongside the token price corrections, reinforcing the sector's underlying health. The defining theme of 2025 for Layer-1s was this stark divergence between speculative price premiums fading and economically productive chains retaining their relevance. While many tokens peaked near all-time highs in early October before a sharp sell-off, the consolidation of capital and activity around networks generating real usage, fees, and revenue points towards a sector undergoing a necessary repricing rather than a fundamental deterioration.
