Let's be honest, Ethereum has brought a lot to the crypto-verse, both in terms of development and innovation, and in terms of attracted investors. And the crypto-verse needed and still needs both as much as possible in its early days.
But where there are funds, there will always be competition to attract them.
And therefore, Ethereum had a strong competition over time. Many newer, technically better blockchains dreamed to take its place, but haven't succeeded.
What technological advancement hasn't achieved yet, something else poses a greater threat to Ethereum's supremacy in the world of smart contacts and defi: fees.
That's something everyone understands. Crypto literate or not, in a battle of immense fees versus small fees, the latter always wins. Especially when fees apply to financial products.
Money goes where it is best treated, saying warns us. And currently it is not best treated on Ethereum.
Seeing the explosive rise of the Binance Smart Chain, most likely, Ethereum developers are pushing to upgrade to Ethereum 2.0 sooner than initially planned. If BSC were to become dominant, that's probably not the best thing to happen for crypto, given the permissioned POS nature of BSC (or proof-of-authority). Its important role is, however, the democratization of access to defi. Something that Ethereum didn't offer because the fees made it elitist.
Ethereum developers also push for an economic improvement proposal for July (EIP-1559), which will basically attempt to reduce fees.
While there is strong support among users and dapp developers for this proposal, miners holding more than 60% of the hash power are against it. After all, in February, over 50% of their revenues came from fees and we are talking about a record-breaking $1.37 billion in total.
Besides the obvious implications fees have on the profits of miners, there is another counter-argument those who oppose come with.
Since the base fee described in the proposal will be burned by the Ethereum blockchain instead of being paid to miners, they are saying there is a risk of going into a deflationary territory, if more ETH is burned through the fees mechanism than the inflation produces. The counter-counter-argument is that Ethereum will likely become more valuable in this case because it becomes more scarce.
It will be interesting how this plays out. If this proposal won't be implemented, does Ethereum hold a chance in the defi game over time? And not only defi. Once other blockchains start to taste the success, they won't stop there.
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