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. The price of Ethereum has basically not moved this year, while Bitcoin has risen by 38%, and even Ethereum's competitor Solana has risen by 31%. This atmosphere is colder than winter ice.

Why is Ethereum in such a bad situation? 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 believes that the pledged ETH is a security, and it is also very worried about Ethereum's decentralized financial ecosystem. If Harris wins and continues the Biden administration's 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 competing in this field. 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 “Layer 2” network, and has not worked hard on the core blockchain. This is indeed effective, and transaction activities on 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 someone else has taken away a large piece.

In terms of ETFs, Ethereum is not as popular as Bitcoin. Although the new ETF also raised billions, the 2.7 billion outflow from the Grayscale Ethereum Trust offset all of this growth.

However, I think these are just superficial phenomena. From a macro perspective, blockchains such as Ethereum and Solana are all building a "public computer" that others can use to build applications. But if you look at those breakthrough and successful applications, almost all of them are Ethereum: more than half of the stablecoins are issued on Ethereum, more than 60% of DeFi assets are locked on Ethereum, and the breakthrough prediction market Polymarket is also finally settled on Ethereum.

For example, BlackRock wants to build a tokenized money market fund this year, which is also built on Ethereum. It now manages more than 500 million assets. Nike launched the Web3 equipment platform .Swoosh, which is also on Ethereum. I dare say that the next large traditional company that wants to make blockchain products will definitely choose Ethereum.

Ethereum has the most active developers, the most active users, and a market cap 5x that of its closest competitor. It is the only programmable blockchain with some regulatory support in the US, a thriving regulated futures market, and a multi-billion ETF market.

It's like Microsoft back then. Everyone loves to talk about Google, Slack, and Zoom. They did bring game-changing technologies. But Microsoft is still bigger than all of them combined. $SOL

I'm not saying Solana or other chains are bad, they are great. But I think people are too quick to overlook the real world success of Ethereum and its ecosystem. $ETH

In my opinion, none of Ethereum's challenges are life-threatening, but opportunities abound. I suspect that as the November election approaches and regulatory clarity emerges, the market may re-evaluate Ethereum. Now through the end of the year, it looks like a potential contrarian investment opportunity. #加密市场反弹