Recently, the market has been buzzing about whether Ethereum (ETH)'s 'second pie' position will be taken over by Solana (SOL), especially during this bull market, where $SOL seems to be gradually closing in. But is this really the case? We cannot ignore the dominant position Ethereum currently holds, especially with the dual support of capital and technology.
Firstly, Ethereum's institutional capital advantage is not to be underestimated. BlackRock's iShares Ethereum ETF has already held over 610,000 ETH, with a total market value exceeding $2 billion. This makes Ethereum not only a hotbed for institutional investment but also brings in capital flows far exceeding other public chains.
Secondly, the dual benefits of staking rewards and ETFs provide ETH with stable capital flow and attractiveness. BlackRock’s staking yields an annualized return of about 3.5%, meaning that $2 billion in assets will generate nearly $70 million in revenue each year. Meanwhile, the ETF's no-fee policy also makes Ethereum more appealing to investors, further driving institutional capital inflow.
Moreover, the supply contraction effect of ETH cannot be ignored. Under the deflationary model implemented by Ethereum, the circulating supply of ETH is gradually decreasing, while the addition of ETFs has stimulated more market demand, potentially triggering panic buying, which further exacerbates the supply-demand imbalance of ETH.
Although Solana has attracted a large number of developers and users in recent years due to its high throughput and low transaction fees, and has made some technological progress, it still faces many challenges in the short term if it wants to shake Ethereum's market dominance. Technological breakthroughs and ecosystem expansion take time, and Ethereum, as the absolute leader of Layer 1 public chains, still has significant advantages in terms of ecosystem scale and capital support.
In summary, ETH is not only the 'value debate' winner in the current bull market but is also likely to become the big winner of the 'capital debate'. Although Solana performs outstandingly in technology, to challenge Ethereum's dominant position, it may still need a longer time to prove itself.
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