Ethereum’s Dominance in DeFi Is ‘Far From Given,’ JPMorgan Says
Ethereum is about to step into a phase of turbulence as its dominion over decentralized financing slowly fades. Experts from JP Morgan Chase believe that the coin’s countermeasures have been timed wrongly and would arrive after the damage is already done. The crypto leviathan lands such a predicament as 2021 opened up the floodgates leading various projects to the front of the line.
Ethereum, the second most powerful blockchain network, has pioneered the industry for so long that most of the crypto projects in vogue today either run or used to run on the Ethereum blockchain. Its Ether coin is currently the second most valuable cryptocurrency, which showed more than 200% in 2021 alone. However, the crypto analyst Nicolaos Panigirtzoglou, a managing director from JP Morgan Chase & co., claimed recently that Ethereum’s market share had dropped down to 70% as compared to its 100% holding in early 2021.
The downward sloping in the market share will continue to haunt Ethereum as long as it takes for Layer 1 solutions to arrive. As the scaling solutions are scheduled to arrive in 2023, it would be too late to repair the damages. This insidious damage caused to Ethereum due to the onset of other blockchain networks could negatively impact the price predictions of the Ether tokens in 2022. Know more here.
Last year diversified the crypto industry, which so far pinned the entirety of the market on Bitcoin and Ethereum alone. Although altcoins other than Ethereum have been in the market for years now, their growth has been barricaded by the two monsters of the market. But the times seem to be changing, as more coins with a system and technical infrastructures far better than Bitcoin or Ethereum are claiming their share of the market. Binance, Avalanche, Cardano, and Solana are a few of the vast number of projects that showed exponential growth. This list with other meme-coins, stable coins, and DEX projects would be too hard to even process.
Ethereum showed 220% gain last year, Solana and Avalanche posted 7000% and 2200% yearly growth, respectively. The stats show that Ethereum is about to face a far more competitive market than it has been through the years. Amidst concerns about fees and transaction speed, the blow could be irreparable unless Ethereum comes up with solutions soon. However, Ethereum comfortably outran Bitcoin while being beaten by its Small-time counterparts.