Ethereum has a robust decentralized security model and that’s why it has remained the preferred blockchain for the DAPP developers but the base layer scalability is a big issue for Ethereum. Ethereum 2.0 is going to solve many problems but the roadmap seems to be very long. While Ethereum has become the most popular value settlement layer with the exponential growth of transactions, the arbitrary gas fee of Ethereum often makes the network unusable for retail investors. The user experience isn’t really good for many Ethereum DAPP users. A blockchain application can’t be unnecessarily expensive and some use cases like blockchain games make no sense with the current speed of transactions or transaction fees. A blockchain must be scalable enough to match the throughput of Paypal or Visa for mass adoption and nobody will like to pay a $50 fee for doing a transaction of $100. Is such scalability achievable in the base layer of Ethereum? No, it’s a distant dream.
The key to the long-term success of Ethereum is 100% dealing with the high gas fees that make the blockchain virtually unusable for everyday transactions. Indeed, if Ethereum had solved for this issue prior to the recent bull-market, it realistically could have put in a serious challenge to Bitcoin supremacy.
Alas, it was not ready, and while Ethereum did enjoy a historic move up price-wise, it did not capitalize to the magnitude that it could and probably should have.
What Ethereum did and still does have though, is the first mover advantage. The project is responsible for bringing to life the power of smart contracts and everything that comes with them. This revolutionary innovation secured an immense amount of equity for the blockchain that is still far from exhausted.
With this in mind, it’s no wonder that solutions like Polygon, Optimism, Arbitrum, Starkware, zkSync and Loopring are seeing such personal successes. They are cleverly trading on the equity manufactured by Ethereum’s first mover advantage while simultaneously betting against Ethereum 2.0.
Personally I think many would-be investors have been lured away from Ethereum by the efficiency promises of competitors such as Cardano and Polkadot, as clearly evidenced by their price movements in relation to Ethereum since the beginning of the recent/current bull market.
Unfortunately for these investors I think they will ultimately kick themselves for not seeing the forest through the trees and recognizing that the first mover advantage of Ethereum, coupled with layer 2 solutions like the ones discussed in this article, are an unstoppable force that can almost certainly never be challenged.
For this reason my view is that Ethereum is undervalued by the crypto community and that when we look back at the current market correction, many of us will be kicking ourselves for not filling our bags.
Honestly, I've always been a big fan of ETH over Bitcoin. I feel that the use cases of ETH as a "product" and as a tech stack for devs has just been overwhelmingly more accepted to be "easier" than bitcoin. The biggest issue has always been, as stated, the gas fees. With the new updated roadmap of ETH 2.0, I think that there are big things that will happen to the crypto ecosystem.
In terms of the NFT space, I think that WAX and EOS has both down a great job in addressing certain concerns over the different issues that ETH would have had (although there definitely is still concern in both blockchains that need to be solved). ETH 2.0 looks promising that it looks to solve a lot of the scaling issues and the gas fees that ETH as a base layer had to begin with. I think that this will be a huge for the crypto ecosystem once ETH 2.0 starts to trade only because it'll be a start of something new. If Bitcoin comes out to solve their issues of an archaic coin after ETH 2.0 comes out, I think that the space will blow up. A lot of issues that new investors have is the withdrawal timing that crypto has in general, which in my opinion make sense. Crypto is not like a normal stock or asset where you can pull out whenever you want (though if you really wanted to only be making money, there is ways to bypass this). The asset that you have in the blockchain is a lot more impactful that holding a same ratio in a normal stock. That layer holds more information and power that any normal stock would have, ex: holding 1 ETH I would say is lot more meaningful to the ETH ecosystem than holding 1 Amazon stock in the same ecosystem. I think that some investors don't realize this fact and just try to find crypto as a a fast money making scheme.
Crypto is an investment and, I believe, the future of transactions in the internet. Once people start to fully realize this, and the security, scalability, and gas fees are fixed, it can definitely be issued as the norm for internet transactions just as credit cards are. Just like people are going to sports card or trading card conventions now and spending thousands of dollars on assets, I believe that the NFT's have potential in the doing the same (some are trading at hundreds and even thousands). Crypto has only started to show small potential in what it can do, but it's already taking over the collector's worlds. Who knows what the possibilities are for the future of NFTs and crypto are?
I have a big problem with Ethereum and i'm sure other users too and that is gas fees. it's not new and we are far from getting this problem solved.
A Crypto veteran knows that sometimes he will need to use ETH and pay for gas, but for someone new to the space, it's scary and makes no sense. This makes adoption very difficult and that's why most of my friends try, hit the ETH wall and either give up or choose another, more gas friendly, blockchain. It almost looks like ETH was designed for elites, both wealthy and savvy.
EOS fills the gap, and WAX makes everything much easier. Actually WAX is like a trap, let's you in easily, you generate value with freebies and, as soon as you realize, you are too deep and hooked, that makes it impossible to get out. It's digital crack!
However, i have faith on Layer 2 and i'm very curious to see where Optimism and Arbitrum will go. IMO making ETH accessible and easy will benefit everyone.
The Ethereum gas fee debate is getting old. It's good to see L2 solutions starting to take off and work around this issue. I love Ethereum but I'm quite tired of waiting for gas prices to come down to be able to use Dapps and make transactions.
Good information on Layer 2 Etherium. Great summary of Polygon Matic and its history. I came across matic while researching Zed run and notice one of the wallet was on weth on matic mainet. Since then I used the matic POS bridge and got on a few polygon projects on farm/pools.
I have Ethereum LITERALLY just for gas fees and then my stash for investment. The gas fees are nuts. However layer 2 is awesome. I found MATIC early and it blew my mind. I started with MATIC in 0xuniverse (which I still dabble in) and it was SO CHEAP TO DO TRANSACTIONS!!!!! The tech is there, now we just have to wait in the integration. Time will be EVERYTHING for ETH here because another chain could do it first, better, and with proper backing... Who knows. Things are crazy right now.
The key to the long-term success of Ethereum is 100% dealing with the high gas fees that make the blockchain virtually unusable for everyday transactions. Indeed, if Ethereum had solved for this issue prior to the recent bull-market, it realistically could have put in a serious challenge to Bitcoin supremacy.
Alas, it was not ready, and while Ethereum did enjoy a historic move up price-wise, it did not capitalize to the magnitude that it could and probably should have.
What Ethereum did and still does have though, is the first mover advantage. The project is responsible for bringing to life the power of smart contracts and everything that comes with them. This revolutionary innovation secured an immense amount of equity for the blockchain that is still far from exhausted.
With this in mind, it’s no wonder that solutions like Polygon, Optimism, Arbitrum, Starkware, zkSync and Loopring are seeing such personal successes. They are cleverly trading on the equity manufactured by Ethereum’s first mover advantage while simultaneously betting against Ethereum 2.0.
Personally I think many would-be investors have been lured away from Ethereum by the efficiency promises of competitors such as Cardano and Polkadot, as clearly evidenced by their price movements in relation to Ethereum since the beginning of the recent/current bull market.
Unfortunately for these investors I think they will ultimately kick themselves for not seeing the forest through the trees and recognizing that the first mover advantage of Ethereum, coupled with layer 2 solutions like the ones discussed in this article, are an unstoppable force that can almost certainly never be challenged.
For this reason my view is that Ethereum is undervalued by the crypto community and that when we look back at the current market correction, many of us will be kicking ourselves for not filling our bags.
I never see OMG on these lists, OMG has great investors and partners developing competitive tech.
ETH 2.0 will never be released
Honestly, I've always been a big fan of ETH over Bitcoin. I feel that the use cases of ETH as a "product" and as a tech stack for devs has just been overwhelmingly more accepted to be "easier" than bitcoin. The biggest issue has always been, as stated, the gas fees. With the new updated roadmap of ETH 2.0, I think that there are big things that will happen to the crypto ecosystem.
In terms of the NFT space, I think that WAX and EOS has both down a great job in addressing certain concerns over the different issues that ETH would have had (although there definitely is still concern in both blockchains that need to be solved). ETH 2.0 looks promising that it looks to solve a lot of the scaling issues and the gas fees that ETH as a base layer had to begin with. I think that this will be a huge for the crypto ecosystem once ETH 2.0 starts to trade only because it'll be a start of something new. If Bitcoin comes out to solve their issues of an archaic coin after ETH 2.0 comes out, I think that the space will blow up. A lot of issues that new investors have is the withdrawal timing that crypto has in general, which in my opinion make sense. Crypto is not like a normal stock or asset where you can pull out whenever you want (though if you really wanted to only be making money, there is ways to bypass this). The asset that you have in the blockchain is a lot more impactful that holding a same ratio in a normal stock. That layer holds more information and power that any normal stock would have, ex: holding 1 ETH I would say is lot more meaningful to the ETH ecosystem than holding 1 Amazon stock in the same ecosystem. I think that some investors don't realize this fact and just try to find crypto as a a fast money making scheme.
Crypto is an investment and, I believe, the future of transactions in the internet. Once people start to fully realize this, and the security, scalability, and gas fees are fixed, it can definitely be issued as the norm for internet transactions just as credit cards are. Just like people are going to sports card or trading card conventions now and spending thousands of dollars on assets, I believe that the NFT's have potential in the doing the same (some are trading at hundreds and even thousands). Crypto has only started to show small potential in what it can do, but it's already taking over the collector's worlds. Who knows what the possibilities are for the future of NFTs and crypto are?
I have a big problem with Ethereum and i'm sure other users too and that is gas fees. it's not new and we are far from getting this problem solved.
A Crypto veteran knows that sometimes he will need to use ETH and pay for gas, but for someone new to the space, it's scary and makes no sense. This makes adoption very difficult and that's why most of my friends try, hit the ETH wall and either give up or choose another, more gas friendly, blockchain. It almost looks like ETH was designed for elites, both wealthy and savvy.
EOS fills the gap, and WAX makes everything much easier. Actually WAX is like a trap, let's you in easily, you generate value with freebies and, as soon as you realize, you are too deep and hooked, that makes it impossible to get out. It's digital crack!
However, i have faith on Layer 2 and i'm very curious to see where Optimism and Arbitrum will go. IMO making ETH accessible and easy will benefit everyone.
The Ethereum gas fee debate is getting old. It's good to see L2 solutions starting to take off and work around this issue. I love Ethereum but I'm quite tired of waiting for gas prices to come down to be able to use Dapps and make transactions.
There is a really serious race for eth layer 2 solutions.
and very necessary
eth is not sustainable with these gas charges.
The success of Tier 2 solutions will give new impetus to the market.
It is exciting to follow these developments.
thanks for this great article
Explained Very well as you always do 🙂
Keep posting Paragism :D
Good information on Layer 2 Etherium. Great summary of Polygon Matic and its history. I came across matic while researching Zed run and notice one of the wallet was on weth on matic mainet. Since then I used the matic POS bridge and got on a few polygon projects on farm/pools.
When I think of ETH and its ability to scale I also think of ADA and smart contracts......How many years has it been now?
A lot of development going on !!! That’s amazing
I have Ethereum LITERALLY just for gas fees and then my stash for investment. The gas fees are nuts. However layer 2 is awesome. I found MATIC early and it blew my mind. I started with MATIC in 0xuniverse (which I still dabble in) and it was SO CHEAP TO DO TRANSACTIONS!!!!! The tech is there, now we just have to wait in the integration. Time will be EVERYTHING for ETH here because another chain could do it first, better, and with proper backing... Who knows. Things are crazy right now.