Ethereum threatens tough competition in the DeFi sector

According to JPMorgan Chase & Co., Ethereum’s dominance in the world of Decentralized Finance (DeFi) will soon be a thing of the past. The market share is currently around 70 percent. The Shard Chains are planned for 2023, which should significantly increase the transaction throughput. But by the time that happens, the market share of the Ethereum network could have fallen drastically, wrote the JPMorgan analysts headed by Nikolaos Panigirtzoglou in a note last Wednesday.

The optimistic view of Ethereum’s dominance is in jeopardy. The scaling necessary for the Ethereum network to maintain its dominance may come too late

, so Panigirtzoglou according to Bloomberg.

In terms of market capitalization, ether is still the second largest cryptocurrency after Bitcoin. But their share of the total value in the DeFi sector, which was almost 100 percent in early 2021, fell significantly over the course of last year. It is noticeably the tokens Solana, Terra and Polkadot that are competing with ethers for the pioneering role.

Polkadot, Solana, NEAR, [Binance Smart Chain], Avalanche, and Terra have faster initial ecosystem growth than Ethereum

Electric Capital

, is it[calledin a new one Message the crypto investment firm Electric Capital. By “initial growth” we mean the length of days since the first “commit”, that is, the change in code, and the number of total developers since that point. Compared to Ethereum at a similar stage, these six Layer 1 ecosystems have more active developers, according to the study.

Solana, Avalanche, BSC and Terra established themselves as new hubs for decentralized financial activities (DeFi) in the past year. The networks accommodate applications for peer-to-peer lending, swaps, and other transactions. Their token prices have skyrocketed accordingly. If JPMorgan has its way, this might just be the beginning.

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Ethereum threatens tough competition in the DeFi sector