There’s no doubt about it: last year was a big one for Ethereum. The world’s top smart contract blockchain captured the crypto community’s mindshare like never before, and for good reason. When Ethereum’s long-awaited “Merge” event shipped in September, the blockchain entered its Proof-of-Stake era. The Merge was a tremendous technological feat. But now that the event has passed, some have raised questions about its significance.
A more efficient Ethereum
The Merge was a big event, but what could it mean for Ethereum’s competitors? It was a popularly held view that Ethereum’s switch to Proof-of-Stake could make other similar networks obsolete, but I take another view. As Ethereum has become 99.95% more energy efficient, The Merge has dispelled some of the arguments that critics level against blockchain technology. A Proof-of-Stake Ethereum is a clean Ethereum. That also highlights the green credentials of other networks like Solana and NEAR. I also believe that Proof-of-Stake has made Ethereum stronger and more secure, which is good for the broader ecosystem. It’s short-sighted to assume that blockchains can only be in competition with one another. A more robust Ethereum will onboard more users, which means that there will be more people exploring other ecosystems. This argument should become clearer as cross-chain solutions evolve.
“It’s short-sighted to assume that blockchains can only be in competition with one another.”
There was a market selloff following The Merge, highlighting the weak sentiment across the space. But such periods have always been a time for building. From studying the token ecosystem over the past few months, it’s clear that many of Ethereum’s top competitors are positioning themselves for success when interest returns. In bull markets, there is often lots of hype surrounding the crypto space. But true winners show their colours in bear markets. There are some subtle clues that point to projects that could have growth potential in the future. They include sustained community engagement, notable development plans, and active usage. Some of the breakout stars of the “alternative Layer 1” boom of 2021 have shown signs of life despite the downtrend.
The multi-chain thesis
We’ve believed in the multi-chain thesis—the idea that several blockchains will thrive and interconnect with one another in the distant future—for some time now. While I don’t think Bitcoin or Ethereum are going anywhere, I think it’s likely we’ll see other chains show their strengths by catering to different use cases. Ethereum may predominantly become a network for decentralised finance, but one of its competitors may find itself gaining ground in the gaming (or “GameFi”) niche. This thesis played into our strategy for token.com when we curated a collection of Ethereum’s Most Promising Rivals. It includes names like NEAR, Solana, and Cosmos—not because we don’t believe in Ethereum, but because we believe in a multi-chain world.
“Many of Ethereum’s top competitors are positioning themselves for success when market interest returns.”
We’ve seen a lot of hype for Ethereum over the past few months. It’s great that the industry showed huge support for the project through a crucial stage of its lifetime. But we shouldn’t discount the many other promising projects in the ecosystem today. It’s still very early, and the race may have more than one winner.
Mel Gelderman, CEO of token.com
Read more via CoinTelegraph here.
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