Ethereum Crashes, Its Share of the Overall Virtual Asset Market Fell Below 7%

This is the first time Ethereum has made a spectacular presence in the market through the early token disclosure (ICO) boom in 2017.

Ethereum's share of the overall virtual asset market fell below 7% for the first time since the early token disclosure (ICO) boom in 2017, where Ethereum made a spectacular presence in the market.

The rapid growth of competitive blockchains, the departure of decentralized applications (dApps), and the low presence of Bitcoin, which has become a digital gold, are cited as the reasons.

According to Trading View on the 22nd, Ethereum Dominance, which is the proportion of Ethereum's market capitalization to the total market capitalization, once fell to 6.95%.

This is lower than 7.09% on September 6, 2019, and is the lowest since the 2017 ICO boom, when Ethereum was trading in earnest.

Ethereum appeared in 2015.

However, at the time, there were not enough coin transactions around the world.

Bitcoin's market share exceeded 95% before the 2017 ICO boom from Ethereum.

Therefore, the market share of less than 7% recorded on the day is actually the lowest since Ethereum began trading in earnest on the market.

The reasons for Ethereum's sluggishness are various.

Recently, JPMorgan cited the rapid growth of rival blockchains and the departure of decentralized applications (dApps) as reasons for Ethereum's sluggish performance compared to other cryptocurrencies.

Unlike Bitcoin, which has established itself as "digital gold," Ethereum has an ambiguous presence.

JPMorgan analyzed that Bitcoin is forming a strong investment demand as digital gold, but Ethereum lacks a differentiated identity.

Unlike Bitcoin, which initially focused on its function as a digital currency, Ethereum was in the spotlight as a "world computer" based on smart contracts.

However, Ethereum's growth is slowing as competitive blockchains such as Solana and Sui grow.

JPMorgan pointed out that the departure of major decentralized exchanges (DEXs), which were operated based on Ethereum such as Uniswap, could lead to a decrease in network revenue.

Layer 2 projects to improve Ethereum, which is slow and lacking in scalability, are also factors that lower Ethereum's competitiveness.

The Layer 2 project is simply a blockchain ledger with a two-layer structure. A simple transaction is a structure in which only important things are collected and recorded in layer 2 and recorded in Ethereum on the first floor.

Lower transaction costs by reducing transaction volume on expensive Ethereum.

However, the spread of Layer 2 is likely to cause Ethereum to disperse trading volumes, resulting in Ethereum inflation.

On the other hand, competitive blockchains such as Solana are growing rapidly, and in particular, meme coin-related activities are increasing rapidly.

Unlike Ethereum, Bitcoin has been showing a good trend recently.

As of 1:30 p.m. on the 22nd, Bitcoin is trading at $88,273, up 1.41% from 24 hours ago on Binance, the world's largest exchange.

Bitcoin topped $88,000 for the first time since April 2.

Unlike Ethereum, Bitcoin's share is 64.54%.

This is the highest in four years since the 64.74% recorded on February 23, 2021.

February 23, 2021, is the second time for Korean standards, when Bitcoin fell slightly after crossing the 65 million won mark for the first time.

Since then, Bitcoin has hit a high of 80 million won.