🧩 Why is ETH "stuck"?
1. Competition from Layer 2 networks
Solutions like Arbitrum, Optimism, and Base offer faster and cheaper transactions, diverting users from the main Ethereum network. This reduces activity and fees on Layer 1, negatively impacting the value of ETH.
2. Migration of dApps to other blockchains
Decentralized platforms, such as Uniswap and dYdX, are exploring or migrating to alternative blockchains in search of better performance and lower costs. This movement decreases demand for ETH on the main network.
3. Inferior performance compared to Bitcoin
While Bitcoin attracted significant institutional investments and ETFs, Ethereum experienced more modest inflows, reflecting lower interest from investors.
4. Decrease in fee revenue
The migration to Layer 2 solutions and other blockchains has resulted in lower activity on the main Ethereum network, reducing fee revenue and affecting the valuation of ETH.
🔮 Outlook for Ethereum
Despite the challenges, Ethereum remains a dominant platform in areas such as DeFi, stablecoins, and asset tokenization. Experts believe that with strategic adjustments and improvements to the network, ETH can regain its growth.
