Deep Dive
1. Ethereum Fusaka Upgrade Impact (Bullish)
Overview: Ethereum’s Fusaka upgrade (activated Dec 3, 2025) introduces PeerDAS (8x data throughput for rollups) and EIP-7917 (deterministic block proposers), directly benefiting Taiko’s L2 efficiency. Preconfirmations on Taiko could achieve ~2-second finality, improving UX for DeFi and RWAs.
What this means: Lower fees and faster settlements may attract developers and users, driving demand for TAIKO. Historical precedent: Post-Dencun upgrade (March 2024), L2s like Base saw 7x transaction growth.
2. DAO Transition & Governance Risks (Mixed)
Overview: Taiko’s DAO soft-launched in May 2025, with full decentralization expected after based preconfirmations go live. Proposals will control protocol parameters, upgrades, and treasury (3M TAIKO rewards allocated).
What this means: Successful decentralization could enhance credibility, but contentious governance votes (e.g., reward distribution) might trigger volatility. Similar DAO launches (e.g., Uniswap) saw 20-30% price swings during initial proposals.
3. Macro Sentiment & Altcoin Liquidity (Bearish)
Overview: The crypto Fear & Greed Index has lingered at 22/100 for 47 days, with Bitcoin dominance at 58.7% (7 Dec 2025). Derivatives open interest fell 8.5% MoM, signaling risk aversion.
What this means: TAIKO’s 90-day decline (-54.3%) aligns with sector-wide outflows. Until sentiment shifts to “Greed,” liquidity may remain thin, exacerbating sell-offs.
Conclusion
Taiko’s price hinges on Ethereum’s Fusaka-driven efficiency gains against a backdrop of cautious markets. Watch TAIKO’s transaction volume post-Fusaka (target: 14 blobs/block by Jan 2026) and DAO proposal participation rates. Can Taiko’s 850K-strong community offset macro headwinds?