While alternative ecosystems have grown significantly, putting Ethereum’s dominance in jeopardy, the news reveals that Vitalik’s kids are still in charge of the NFT game for the time being.
Since August 2021, the network’s gas fees have reduced drastically, according to the most current estimates, Ethereum has seen over one million NFT purchasers on its marketplace.
Strange Currents in the Ethereum Market
The fact that the average transaction cost for Ethereum is falling shows that investors are losing interest in the ecosystem’s involvement.
This will be a major roadblock to the blockchain’s rebirth and advancement.
On the other side, it gives the appearance that visitors can easily enter and explore the DeFi and NFT areas.
The Ethereum milestone does not include fictitious buyer accounts, but rather real users who use their accounts to conduct blockchain purchases.
Apart from the historical significance, data from the last 24 hours revealed that NFT sales on Ethereum increased by 36.06 percent, exceeding the growth of any other blockchain with at least US$100,000 in sales during the same period.
Ethereum network is no longer a lonely market
Ethereum is anticipated to be taken over by “Ethereum killers” such as Solana or Polkadot. Last year, these programs also gained traction, attracting significant funding and public attention.
The world’s second-largest blockchain is frequently chastised for its high transaction fees and poor transaction speeds.
Meanwhile, the existing Proof-of-Work process is not only inefficient but also harmful to the environment.
JP Morgan cautioned in a statement that Ethereum’s dominance was in jeopardy due to the high price, with rival blockchains gaining market share.
What has been striking during this month’s correction is that Ethereum has not managed to re-capture market cap share vs. its main competitors as its price declined by a similar magnitude to smaller altcoins.JP Morgan
If the network is to build and grow efficiently, lower transaction fees are unavoidable.
Aside than that, it’s just like any other centralized system. Unfortunately, transaction fees on the Ethereum network have been constantly high since July 2020.
Despite the fact that this transaction charge only applies to small-scale transactions, Ethereum’s flaw is what makes other blockchains like Binance Smart Chain, Terra, Avalanche, or Solana attractive. These alternatives have been adopted by some DeFi protocols.
After being substantially harmed by Ethereum’s low scalability, the well-known CryptoKitties development team decided to quit.
There has never been a perfect system
Unlike JP Morgan, many experts believe that alternative networks will be unable to challenge Ethereum’s dominance.
Since early January, the average transaction cost for Ethereum has plummeted to $11, a considerable decrease.
Although it is not as low as Solana’s, it is still a promising sign, especially for people who are familiar with the Ethereum blockchain.
Ethereum 2.0 is clearly the long-term strategy that Ethereum is pursuing. It encourages the Ethereum network to grow, lowering the present barrier.
This also means that the amount of gas that users on the same network must pay will be more ideal.
The Ethereum team is working hard to fulfill the deadline for the project’s completion. Ethereum is migrating to a more environmentally friendly mining paradigm known as Proof-of-Stake (PoS).
The new approach, according to Ethereum’s creators, will boost the project’s position in the crypto market after the transition is complete.
Since records are made to be broken, change is impossible. Despite the fact that Ethereum is still the king, the blockchain’s influence in the NFT market has waned.
Due to its lack of scalability and a suitable fee structure, Ethereum will struggle to keep up as more money comes into the NFT ecosystem.
The second-largest cryptocurrency project, according to analysts, will most likely revamp its network in 2023. Other blockchains still have a chance to come up to this second-largest participant in terms of scalability at the moment.