- TradFi adopts Ethereum L2s for privacy, compliance; ZKsync validiums aid Deutsche Bank’s Project Guardian tokenization.
- ZKsync targets 10k TPS; UBS, Fidelity tokenize gold, treasuries on low-cost Ethereum L2s.
Traditional financial institutions are increasingly adopting Ethereum Layer 2 (L2) networks for tokenizing real-world assets (RWAs), favoring their flexibility and compliance features over alternative blockchains like Solana or Stellar.
These L2 solutions, built atop Ethereum, offer tailored environments for asset tokenization while addressing institutional demands for privacy and regulatory adherence.
Ethereum L2s allow firms to create private, configurable networks that meet specific legal requirements. For example, ZKsync’s Elastic Network enables companies to store transaction data in controlled validiums—off-chain storage solutions—ensuring compliance with regulations like the EU’s GDPR.
L2 networks like ZKsync aim to process up to 10,000 transactions per second (TPS), with projects such as MegaETH targeting even higher throughput. While these speeds remain theoretical, they surpass Ethereum’s base layer and many competing L1 chains.
Lower transaction costs further appeal to institutions managing high-volume asset transfers. UBS and Fidelity have piloted gold tokenization and treasury projects on zkSync Era, leveraging these efficiencies.
Hybrid Solutions for Institutional DeFi
Converge, an L2 developed by Securitize and Ethena, blends permissioned and permissionless decentralized finance (DeFi) applications. It integrates regulated asset trading with platforms like Aave and Pendle, offering compliance tools for institutions while resisting exploitative trading practices. Despite reports, Converge will not initially migrate $8 billion in assets but will host Ethena’s $1.2 billion stablecoin pool, emphasizing gradual institutional onboarding.
While Ethereum L2s dominate current RWA projects, chains like Solana and Sui are gaining attention. Securitize’s recent partnership with VanEck to launch a multi-chain treasury fund on Ethereum, Avalanche, and Solana highlights a shift toward interoperability.
Similarly, Ant Digital’s Jovay L2, tokenizing renewable energy assets, may expand beyond Ethereum to collaborate with other chains, reflecting TradFi’s preference for practicality over blockchain loyalty.
Institutions prioritize control and security over decentralization. Converge’s validator network can pause transactions during breaches, a feature contradicting crypto’s decentralized ethos but aligning with TradFi risk protocols.
Ethereum (ETH) – Time Price & Market Analysis – May 22, 2025
Ethereum (ETH) is trading at $2,630.70, up +3.08% on the day, continuing a strong upward trend following sustained demand from institutional investors and retail traders alike.
Over the last month, ETH has surged +66.79%, signaling a robust recovery in market structure. Despite this, the asset remains -20.91% year-to-date and -30.48% below its level from 12 months ago, highlighting the longer-term volatility that has defined much of Ethereum’s cycle in 2024–2025.
Technically, ETH is currently holding above $2,600, having broken and sustained above prior key resistance levels. The price is now approaching the $2,746 resistance zone, and if broken with volume, it could target $3,000–$3,500 in the short term. ETHNews analysts are pointing to minimal resistance on Binance’s liquidation heatmap up to $3.5K, making such a move technically plausible.
Fundamentally, Ethereum is gaining momentum thanks to several powerful catalysts:
- The SEC is reviewing BlackRock’s proposal for in-kind redemption related to a spot Ethereum ETF, a development that could pave the way for regulated ETH exposure in U.S. markets.
- The decentralized trading platform Hyperliquid has reported $8.9 billion in open interest, reflecting increased DeFi activity that includes significant ETH volumes.
- On-chain data shows Ethereum addresses in profit have nearly doubled since April lows, suggesting improved market sentiment and broader confidence.
