When talking about Ethereum now, many people look disgusted, just like the misunderstanding of Microsoft back then. You see, the ETH/BTC ratio has fallen to a three-year low. This year, the price of Ethereum has basically not moved, while Bitcoin has risen by 38%, and even Ethereum's competitor Solana has risen by 31%. This atmosphere is even colder than winter ice.
Why is Ethereum so miserable? There are several reasons. First, the November election is like a sword of Damocles hanging over its head. Bitcoin has passed the regulatory test, and even the chairman of the US SEC said it is not a security. But what about Ethereum? The SEC thinks that the pledged ETH is a security, and it is also very worried about Ethereum's decentralized financial ecosystem. If Harris wins and the Biden administration continues its skeptical attitude towards cryptocurrencies, Ethereum will have a harder time.
Let's talk about competition. Ethereum is now facing challenges from new blockchains such as Solana, which have high throughput and low costs. Solana is a typical example, but there are other new projects squeezing into this track. Now in the circle, more people are optimistic about Solana and other new chains than Ethereum, because Ethereum technology is old and the cost is high.
Another problem is Ethereum's token economics. In recent years, the Ethereum community has focused on increasing transaction volume on the "Layer2" network, and has not worked hard on the core blockchain. This is indeed effective. The transaction activities of second-layer networks such as Base, Arbitrum, and Optimism have soared. But what is the result? The second-layer network has taken away all the transaction volume, and Ethereum's revenue has fallen to a four-year low. It's like Ethereum has made the pie bigger, but others have taken away a large piece.
In terms of ETFs, Ethereum is not as glorious as Bitcoin. Although the new ETF has also raised billions, the 2.7 billion outflow from the Grayscale Ethereum Trust has offset all this growth.
