Ethereum’s Layer-1 network revenue has seen a staggering decrease of 99% since March 2024, even though monthly users and transaction volumes on Layer-2 solutions have increased. Token Terminal data shows that the network fees reached a high of $35.5 million on March 5, 2024, but the Dencun upgrade release just eight days later significantly cut fees for Layer-2 transactions.
Institutional Adoption Boosts Ethereum’s Credibility
Ethereum supporter Adriano Feria, who is also an AI enthusiast, took to X to hit back at Ethereum critics. He stated that Ether is making considerable progress towards institutional adoption as significant companies such as Coinbase, Circle, BlackRock, and the latest one, Sony, are supporting it.
Feria further suggested that maybe Robinhood and Toyota would soon join the list. He was of the opinion that institutional adoption, which is more permanent, is the main reason for the success. Whereas the speculative ways of “degen anons” who are flipping tokens or NFTs for quick profits are not the reason.
Feria pointed out the benefits of Ether’s scaling through “network extensions” that provide features that are not possible to achieve on layer 1. The additional networks enable better fee market control and the definition of standards for different features, thus, the final user experience is better.
He criticized, those who ignore these technologies, only for the reason that they are on Ethereum and differ in vocabulary. Feria pointed out, that in spite of some people’s conviction that monolithic chains will become modular systems in order to be relevant in the future, Solana is already on the way to achieving it, although at a cost of rebranding efforts that have been widely appealed to.
Although there is some doubt about the Ethereum layer-2 solutions being viewed as fragmented or parasitic, Feria said that they are growing rapidly and creating great possibilities. He noted that the leading layer-2 solutions, among which are Coinbase’s Base, Arbitrum, and the new layer-2 from Sony, are using Ethereum’s liquidity and network effects. Therefore, it is necessary for industry leaders to acknowledge and adapt to this change.
Feria came to the conclusion that even if Ethereum is always hated and criticized, it is typically followed by imitation. He says that regardless of what their opponents say, the further development of Ethereum is a new picture of the financial world. Still, the rapid development and institutional interest in the layer-2 solutions prove Ethereum’s primacy in the development of the blockchain.
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