Ethereum, the world's second-largest crypto by market cap, is facing significant challenges. The ETH/BTC ratio has dropped to 0.022, signaling sharp declines in Ethereum's relative performance.
ETH/BTC hits a multi-year low
Since September 2022, ETH/BTC has shed over 73%, reflecting Ethereum's slipping dominance in the smart contract and L1 ecosystem. Once unmatched, Ethereum is now being challenged by competitors like Solana and Binance Chain.
Ethereum’s metrics show signs of softening
Ethereum's total value locked (TVL) has fallen to $50.5 billion, signaling a loss of DeFi market share. High fees and slower transactions remain issues, as users shift to faster and cheaper platforms like Solana.
Scalability trade offs are catching up
Despite energy efficiency improvements following the switch to Proof-of-Stake, Ethereum has failed to enhance base scalability. As a result, the network relies on layer-2 solutions, diverting users and transactions from the mainnet.
Ethereum faces multiple challenges as its L1 market share declines amidst rising competition. Despite improvements such as lower fees, the network struggles to maintain dominance without significant performance enhancements.
