Ether (ETH) has underperformed year-to-date, declining over 20%, but fundamentals are improving and total value locked (TVL) on the Ethereum blockchain has risen dramatically, Wall Street bank Citi (C) said in a research report Monday.

“While user activity has been volatile in recent weeks, the fundamental backdrop is not all that murky,” analysts led by Alex Saunders wrote.

Citi noted that TVL on the Ethereum network has risen sharply, while ether exchange-traded funds (ETFs) are still seeing inflows, and search interest is rising.

Following the U.S. election in November, ether ETF flows turned positive, the report noted, with total inflows of $3.2 billion since their July launch.

Stronger user growth on layer-2s and rival blockchain’s such as Solana has raised questions about Ethereum’s competitive advantage, the report said.

President Trump’s World Liberty Financial holds more than $200 million of ether, and this could be viewed as “additional motivation for ensuring the U.S. strengthens its support for the crypto industry,” the bank said.

“Relative ETH and altcoin performance may serve as a gauge for how optimistic the industry is regarding follow-through on regulatory clarity in the U.S.,” the report added.

Citi noted that weakness in ether has coincided with an increase in bitcoin (BTC) dominance, which is now at multi-year highs above 60%.