Ethereum Under Threat, Layer 2 to Take Over Ethereum Revenue?

Bittime - According to Cyber ​​Capital founder Justin Bons, Ethereum is facing a serious threat as the Layer 2 network appears to be taking over the market share and revenue of the Ethereum platform.  

Ethereum and EIP-4844 

Bons highlighted the impact of implementing Ethereum Improvement Proposal 4844 (EIP-4844), or what is known as Proto-Danksharding. Since EIP-4844 was implemented, Ethereum has experienced a decline in revenue from transaction fees. 

According to Bons, this is a worrying signal because the income obtained from transaction fees is no longer able to keep up with the network's inflation rate. 

This condition indicates that Ethereum is starting to lose its competitive edge, especially in terms of revenue obtained from network use.

Read Also: Ethereum Predicted Not to Rebound in the Near Future

Layer 2 Network Taking Over Ethereum?

Smeanwhile, Layer 2 (L2) network usage and the resulting revenue actually reached new highs. The L2 network, which was essentially designed to help Ethereum overcome its limitations in terms of scalability and transaction costs, is now considered a threat to Ethereum. 

Bons describes the relationship between Ethereum and L2 as a parasitic one, where the L2 network allegedly takes advantage of Ethereum's limitations by attracting users and revenue to the L2 platform. 

Bons alleges that the L2 network pretends to be part of Ethereum, when in fact L2 is stealing users and revenue from its parent platform.

Ethereum's Declining Dominance

Bons also expressed his prediction that L2 networks will eventually migrate or become independent Layer 1 (L1) networks. If this happens, Ethereum is predicted to decline further and lose its position as a leader in the blockchain world. 

Bons did not hesitate to blame the leaders of Ethereum for “betrayal" This. He highlighted that the decisions taken by Ethereum's leadership indicate systemic problems in the governance of this network. According to Bons, this is proof that Ethereum has failed to protect its long-term interests.

Read Also: Ethereum Annual Inflation Rate 0,5%, High or Low?

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