Against the backdrop of instability in the crypto market, Ethereum is under pressure not only from falling prices but also from increasing competition. Second-layer networks (Layer 2) and alternative blockchains are challenging Ethereum's dominance by offering faster and cheaper solutions for users and developers.
Pressure from below: Layer 2s are advancing
Second-layer networks, such as Arbitrum, Optimism, and Base, are rapidly growing, attracting dApp developers and users due to low fees and high transaction speeds. Many DeFi projects have already transitioned to these solutions, leaving the main Ethereum blockchain with relatively low activity.
Alternatives are on the way
Solana, Avalanche, Near, and other Layer 1s continue to strengthen their ecosystems. Solana, despite past issues, is regaining popularity due to scalability and active development. These projects pose a direct threat to Ethereum in the fight for liquidity and community attention.
Ethereum's economy under pressure
Decreased activity on the network leads to falling validator revenues and waning interest in staking. This raises concerns among ETH holders: can Ethereum remain resilient if transactions and activity continue to shift to other platforms?
What’s next?
Ethereum remains the largest platform for smart contracts, but its dominance no longer seems indisputable. In the face of increasing competition, only technological advancements (including Danksharding and Proto-Danksharding), reduced fees, and active work on scalability can restore ETH's strong position.