- Exorbitant costs are preventing a major segment of the DeFi community.
- Ethereum’s share of the decentralized financial sector has decreased.
The JPMorgan Chase analyst Nikolaos Panigirtzoglou predicts that Ethereum’s supremacy in the decentralized financial industry would continue to erode. The network will be partitioned into several shards in order to boost its scalability. One of the most anticipated new features of Ethereum 2.0 is sharding.
Even if the shard chain phase kicks out in 2023, Panigirtzoglou feels that it will be “too late” for ETH to catch up to their competitors.
Over the last year, Ethereum’s share of the decentralized financial sector has decreased. According to statistics given by DefiLlama, Ethereum’s share of the total value locked in DeFi protocols has dropped from 97 percent in January to 63 percent owing to the quick expansion of rivals including Terra, Binance Smart Chain, Avalanche and Solana. Panigirtzoglou seems to be especially concerned by the fact that Ether is losing ground to other blockchains. According to JP Morgan’s analysts, Ethereum-killer Solana, poised to compete for the largest share of the altcoin industry.
Might Turn Negative in 2022
Exorbitant costs are preventing a major segment of the DeFi community from using the Ethereum network. ETH’s price surged 396 percent in 2021, making it a year to remember for the coin. It is possible that the second-largest cryptocurrency may take a negative turn in 2022 as the network continues to face intense competition.
As a result of a market correction brought on by imminent interest rate rises and falling Bitcoin hashrate, Ether’s value has plummeted in recent weeks. According to CoinMarketCap, the Ethereum price today is $3,127.22 USD with a 24-hour trading volume of $11,648,442,735 USD. Ethereum is up 2.14% in the last 24 hours.