Analysis of the 6 major reasons for the stagnation of Ethereum: unexpected impact of upgrades, ETF failure, failure to keep up with the trend..

Ethereum still has an important first-mover advantage in the field of Decentralization, but whether it can maintain its core value still needs to find a new balance between L2 development and other narrative trends. This article is from BTC_chopsticks' long push, compiled, translated, and written by PANews. (Previous context: Ethereum OG firing: Five reasons, Solana has no hope of becoming a global mainstream Blockchain) (Background supplement: Perspective: What caused Ethereum (ETH) to lose its vitality?) Ethereum (Ethereum) was once considered as the "blue-chip asset" in the encryption market, and people generally believed that its price would reach new highs in the future, even surpassing $10,000. However, since 2022, the performance of ETH has been sluggish. Does this indicate challenges for Vitalik and the future of Ethereum? Let's delve into the reasons behind this. 1. Discrepancy between expectations and reality Over the past two years, the significant upgrades of Ethereum have fueled high expectations for its future, especially the "deflation" effect of ETH supply. However, the actual market performance has been surprising. Despite a series of expansion and upgrades, the market performance of ETH has been relatively lackluster, even significantly surpassed by BTC and other Tokens (such as Solana). 2. Failure of ETH ETF Many people hoped that the launch of ETH ETF would drive up the price of ETH, but the result was a great disappointment. Unlike the uptrend when BTC ETF was launched, there was a capital outflow after the listing of ETH ETF, partially due to the dumping pressure from Grayscale's legacy products. 3. Unexpected impact of upgrades The Ethereum merge (The Merge) and EIP-1559 did successfully reduce the issuance of ETH, but the latest Dencun upgrade, while dropping the cost of data writing to the mainchain, indirectly reduced the source of income for ETH, unexpectedly dropping the potential value of Token. 4. Concerns over Vitalik's ETH dumping Ethereum's founder Vitalik recently dumped a portion of ETH to support development. Although the amount dumped is relatively small, the market has generated negative sentiment. Some investors believe this may imply a lack of confidence in ETH by Vitalik, although in reality, Vitalik has repeatedly stated that the price of ETH is not his priority. 5. Absence in emerging trends Many emerging trends in the market - such as AI, RWA (Real World Assets), and memecoin - mostly did not choose Ethereum as the main platform. Many emerging AI projects (such as Fetch, TAO) and RWA projects have chosen more suitable independent networks and underlying architectures, while in the memecoin field, Solana's performance is evidently more impressive. This means that while Ethereum has opened the door to Decentralization, other networks are becoming the leaders in the latest narratives. 6. The future value destiny of ETH Currently, Ethereum still plays a pivotal role in the Decentralized Finance (DeFi) ecosystem, occupying over 55% of the total locked value. However, with the popularization of L2 expansion solutions, the future of Ethereum may face the dilemma of "ecological prosperity but unrealized Token value," similar to the $ATOM coin in the Cosmos ecosystem. Personal outlook Although I once firmly believed that the price of ETH would reach $10,000, I have become more cautious about this goal. ETH still accounts for 30% of my investment portfolio, but in the next Bull Market, I may gradually sell off some assets and hold the remaining part for long-term observation. Conclusion: The network utility and ecological status of ETH are still solid, but the recent performance has raised concerns in the market. Although ETH still leads the industry, if it fails to keep up with emerging trends, it may gradually lose some of its dominant position. Ethereum still has an important first-mover advantage in the field of Decentralization, but whether it can maintain its core value still needs to find a new balance between L2 development and other narrative trends. Related reports Vitalik Buterin's domineering: Give me some respect! Ethereum Foundation's selling of ETH is not playing people for suckers, it's to ensure the operation and development ETH / BTC largest long whale suspected of "admitting defeat and dumping 20,000 coins" Ethereum, Vitalik rare confidence call Japanese BTC / Ethereum spot ETF promoted! Proposals supported by institutions such as Mitsubishi UFJ, Nomura Securities, and Sumitomo Mitsui Banking Corp. "Analysis of 6 reasons for Ethereum's stagnant rise: unexpected impact of upgrades, ETF failure, failure to keep up with the trend.." This article was first published on BlockTempo, the most influential blockchain news media on BlockTempo.