The Ethereum Predicament
The essential difference between this round of cryptocurrency bull market and the previous two rounds is that Ethereum has not led the wave of technological innovation. Compared to the ICO frenzy in 2017 and the DeFi Summer in 2020, the biggest highlight of this cycle is Meme, and most of the Meme community is on Solana; the Layer2 and Restaking concepts led by Ethereum have instead had some negative impact on the Ethereum ecosystem.
Currently, while hundreds of Layer2 ecosystems have improved Ethereum's trading experience and performance, they have also brought severe diversion issues; the reduced costs of upgraded Blob have affected Ethereum's economic model and staking income. When ETH demand decreases, the rate of destruction is less than expected, leading to an inflationary state, which also weakens its potential as a store of value; meanwhile, Bitcoin has an irreplaceable attractiveness to institutional investors in the field of value storage, and the newly launched Ethereum spot ETH this year has become a non-issue.
On the other hand, Vitalik Buterin, as the community leader, has a rationalist temperament that profoundly influences the entire ecosystem. Vitalik has a very grand vision for the future development of Ethereum, and recently he has angrily written several long articles, conducting various studies on Ethereum's decentralization, security, scalability, and other aspects.
However, from the community perspective, some of these goals are overly idealistic, with a significant gap between the current technical limitations and market expectations. At the same time, Vitalik holds too much influence in Ethereum's community governance and decision-making, which contradicts the ideal of decentralization and may lead to a decision-making process that is not democratic or decentralized, with the community's voice being intentionally or unintentionally ignored, making him seem particularly out of touch compared to the collective pursuit of the wealth code.
But isn't this just Vitalik? The young man who shed tears over Blizzard's weakening of the Warlock's skills and angrily entered the blockchain world to establish Ethereum. If Vitalik were to become the New Money, continually promoting and indulging in excess, that might indeed be the crisis the Ethereum community needs to worry about regarding FUD.
