According to Cointelegraph, Ethereum's dominance in the layer-1 (L1) blockchain sector is waning, leading to an open competition for the top spot in the Web3 platform arena. Alex Svanevik, CEO of data service Nansen, highlighted this shift during a panel discussion at the LONGITUDE by Cointelegraph event. He noted that a few years ago, Ethereum seemed poised to dominate the crypto space, but the current landscape tells a different story.
Ethereum remains the most popular L1 network, with approximately $52 billion in total value locked (TVL), accounting for 51% of the cryptocurrency on blockchain networks, as per DefiLlama data. However, this is a significant drop from 2021, when Ethereum controlled up to 96% of the aggregate TVL. Svanevik emphasized that the race is now open among multiple L1s to become the preferred platform for trading and broader blockchain applications. He pointed out the rapid growth of smaller chains and the emergence of five or six as potential leaders, marking an exciting period in the blockchain sector.
Solana (SOL) is emerging as a strong contender in this race, known for its faster transactions and lower fees compared to Ethereum. Svanevik mentioned that Solana has surpassed Ethereum in several on-chain metrics, including active addresses, transaction volume, and even gas fees. Despite Ethereum's continued lead in TVL and strong stablecoin issuance, Solana's growth trajectory is noteworthy. Meanwhile, numerous smaller L1s are also competing for market share, though not all are achieving sustainable growth. Vardan Khachatryan, chief legal officer of trading platform Fastex, observed that many chains gain popularity during specific bull runs due to hype, new coins, and airdrops, rather than through sustained adoption.
