Ethereum has been the second leading cryptocurrency, and the leading decentralized platform for developers for a few years now, but is it’s reign of smart contract supremacy about to be usurped?
With a market cap north of $25 billion there is without question a lot of faith in it, and is much higher than its smart contract competitors, even though Cardano has been on a major run of late.
And with Ziliqa and EOS, Ethereum’s other two other distant competitors a long way off you might think Ethereum’s place as the smart contract platform of choice is safe.
Is Ethereum’s Reign As Smart Contract King Be Under Threat?
BlockTower Capital’s Joseph Todaro and ETH bag holder believes it could be.
The fund manager explained why ‘many little-known Ethereum rivals will significantly outperform ETH’ this upcoming cycle.
He tweeted a six-part thread on the matter to express his sentiment.
Todaro said that as ‘Ethereum finds product market fit with DEXs, DeFi and as the stablecoin settlement layer, blockspace demand will continue to increase.’
Which would only result in higher transaction fees. ‘Scalability will raise its ugly head once again,’ is how the fund manager put it.
Although he did say Ethereum had never been ‘so certain’ thanks to the success of DeFi, which had humbled the most ‘steadfast of Ethereum doubters.’
A Dark Horse To Usurp Ethereum?
And the problems that will face Ethereum as the success of DeFi picks up will mean only one thing in Todaro’s opinion: ‘A dark horse’ competitor will emerge and challenge Ethereum for the right to be king of the smart contract platforms.
‘For a while the dark horse goes unnoticed. It doesn’t yet have its army of shillers who will provide warm feelings of confidence and certainty of success. But they are coming. […] It is time, once again, to look at the neglected and scorned ETH competitors.’
Todaro didn’t name any competitors, but there can be no denying Cardano is a challenger to Ethereum, especially as its already shifting onto its Shelley mainnet and a full transition onto proof-of-stake, which should see it scale to thousands of transactions a second.
What Does Ethereum Need To Do?
Ethereum has to scale, by launching the Ethereum 2.0 transition itself. It’s the only way Ethereum can guarantee its status as the main smart contract platform.
Ethereum 2.0 will see Ethereum transition onto a proof of stake consensus mechanism, but it was due to launch in January 2020, and then July, but is now being delayed again.
When it’s implemented, it will see Ethereum scale to meet the demands of dApp builders and bring down the costs of transactions, the two things that are plaguing Ethereum.
But when will the Ethereum 2.0 upgrade start?
‘Had we known that it would end up taking us years, we probably would have designed the roadmap differently,’ said Buterin, who admitted to having ‘a lot of regrets and wasted time’ regarding the upgrade capabilities.
Ethereum’s Place Is Under Fire
Ethereum is quite rightly the second-biggest cryptocurrency by market-cap, but the success of its eco-system and its failure to launch Ethereum 2.0 is starting to make it vulnerable.
I can only see DeFi growing, and as most of it is on Ethereum, the network will continue to be congested, meaning higher transaction fees.
It really does have to be sorted in the next few months, because as far away as Cardano is, we all know that once the alt season is among us, a lot of money can be ploughed into promising altcoins.
It takes blind faith to believe Ethereum couldn’t be overthrown, but if I had to put faith in one person in crypto it would be Vitalik.
Author: Pablo Clarke