Topic: The Ethereum killer storyline part 2 might be beginning (Read 963 times)

Solana is going good but not that good. Mainly it's going good because of all the memecoins that are pumping right now. But because I believe they will pump for a small amount of time, solana may even loose it's popularity long term, thus it will never reach ethereum's market cap.

I shake my head on your argument because what you are telling us is very much not true. Are you using the bridges that have been developed in the bear market since 2022? There are also other bridges that have been developed before the bear market occurred. Transferring tokens and using bridges for crosschain swaps is presently much easier. You can transfer ETH to SOL, ETH to layer2 and it will not take more than 1 minutes for the transfer process, others are instant.

..And mostly, it's just a buzz to get the funds flowing, unfortunately. These trends which just change each other like a rainbow after the storm.
However, hey - aren't we already used to it?   

Honestly, if there is an ETF for it, we could actually see some bigger increases with a doubt, we just need a few billion dollars invested that's it. Think about it, we are talking about 295 billion marketcap ETH here, and we are talking about just mere 50% of it as well, so that would be 147.5 billion dollars, nothing all that high.

So there isn't really a big ask here, if price of SOL goes twice higher, then it goes beyond that level, it is not really that impossible for SOL to increase higher than ETH increases, there is more room for growth for SOL at the moment, it requires a lot more money for ETH. If the article said SOL will go higher than ETH, then I would say they are talking nonesense without a doubt, but reaching just 50% doesn't really feel that bad.

I guess people don't want to move away to another chain with an added learning curve. Switching from ETH to a L2 chain based on rollups is not as easy as it sounds. It's why most people prefer high-performance and cost-efficient chains such as Solana and BSC/BNB. If ETH developers focus on scaling the L1 blockchain, I'm sure adoption will increase tenfold.

Hopefully, your prediction comes true. But be aware that AI-based tokens are taking the world by storm. It might become the hottest trend besides Gamefi, "De-Fi", NFTs, and whatnot. Who knows how ETH will perform in the future?

The Ethereum holders who argue that Blackrock CEO and the new mayor of Bitcoin Larry Fink supports Ethereum and it has an ETF already, it appears that there is also an argument that there are institutional investors that are also filing their own ETF for Solana. It is beginning to appear that the only positive argument for Ethereum is the ETF inflows which has not arrived after the approval. It will be very headshaking for them if the approval for the Solana ETF will have very big inflows on SOL and pump this hehehe.



new SOL vehicle to would-be institutional investors.

Canary Capital Group’s Wednesday filing for a spot SOL ETF with the SEC comes a few months after VanEck kicked off the process with a filing of its own.

The fresh filing is a cause for celebration, certainly — especially if you’re of the opinion/hope that next week’s election will usher in a far less, shall we say, Gensler-ish take on US securities oversight. Sitting SEC commissioners on the Republican side are of the view that investors, not regulators, should judge the merits of such products, and in the event that Donald Trump prevails, Chair Gary Gensler may find himself out of a job sooner than later.

Read in full https://blockworks.co/news/canary-capital-sol-etf-filing

I reckon answer on why rollup tokens are not very much valued by the community might be because this does not give the holders a share of the revenue from fees collected by the rollup. If they can give some yield to the holders for staking, we can be quite certain much of these DeFi farmers will certainly buy and stake.

This might continue on 2025 and the community will continue to ignore this. I predict the return of gamefi and play to earn projects with better tokenomics.



By some measures, Ethereum’s bet on its “rollup-centric” future has gone too well: Rollups now process more transactions than Ethereum itself and have been called parasites that depress the price of its cryptocurrency.

So, why doesn’t anyone want their tokens?

Tokens for major rollups, also known as layer 2 blockchains, or L2s, have had a miserable year: Arbitrum is down 66% since January 1; Optimism has fallen 56% in that span; Starknet is down a whopping 84%; and ZkSync is off 55%. Mantle has been the least worst off, falling a modest 10%.

At the same time, crypto has boomed.

Read in full https://www.dlnews.com/articles/defi/can-the-rollup-token-market-break-its-2024-slump/

BTW Vitalik announced that Ethereum will do the purge to overcome the Ethereum data liberation, however Ethereum requires efficiency there and then he will simplify the Ethereum protocol to make it easier to navigate Ethereum networks and developers will be more easy to avoid bugs in the tissue.
We do not know what is the percentage of the success of this Purge Tea, but I strongly support Ethereum to be more friendly and dispose of outdated complexities that do not need to be used again in the Ethereum network.

See? More projects moving away from ETH. Partly because of the main chain's limited transaction capacity. At least, Unichain will be a L2 network built on top of the ETH blockchain. This shouldn't affect ETH's market dominance. After all, L2s depend on ETH to survive. It would've been a problem if Unichain was a separate chain.

Let's face it. Around 90% of smart contract chains are based on the EVM. Propietary chains such as Solana and Cardano are the minority. It's no wonder why ETH is still the "King". I'd expect Vitalik and team to scale the main ETH blockchain for greater benefits in the long run. High fees and slow confirmation times will no longer be an issue to ETH users. Just be patient to see good results in the long run. In my eyes, ETH will be the #2 crypto in market cap forever. "Ethereum Killer"? Says who?

Yes, these are the arguments that folks that think ETH is going to die due to parasitic nature of Layer-2s right now on Ethereum. Almost all L2s not just base does that. My thesis is that Base will never airdrop to its users due to the fact that Coinbase itself is in the US and they're on the SEC watch list. Iirc, Coinbase was even sued by SEC this year. I think it's a similar story with Linea being that it's a product of consensys.

It's time to face the reality that L2s might just siphon liquidity from Ethereum and remit very little value back and that's going to be the reality for a long time.

@nelson4lov. Are you following the conversation of the thread? You should read it from the beginning hehehehe. I am talking about the value gathering premium of ETH because this is a proof of stake blockchain. Base layer 2 has made millions in fees, however, this paid the Ethereum blockchain only in thousands. I speculate that if Coinbase will issue a token for their layer 2, they might give this millions in value gathering premium to the stakers of the token of their layer 2. The token holders will certainly dump some or much of the ETH they earn from staking.

Also, there is the argument on netflows in Solana and Ethereum. You should read this.

Layer-2s don't need to become Layer 1. There are already plenty of Layer 1s already and it would cost existing layers 2 much more than it would cost them to continue running their layer 2s. At least with Ethereum as the L1 + EigenLayer's shared security, these layer2s can benefit from the security without needing to bootstrap their own security. About the issue of fragmentation of users, that's bound to happen even with L1s. However, the layer2s that can capture the most users and get them using the chain for daily activities like Arbitrum and probably starknet, would win in the long run.

NFT is just one protocol among many others though, Ethereum utility is not lacking, we can see the smart contract being utilized heavily, so many other standard protocol other than NFT still being utilized heavily.
I don't think it lacks any network utility at all.
ETH just falling behind in speed and transaction cost but really if we are talking about utility, it's as good as any other smart contract capable blockchain that just got released recently.
even most of the newer blockchain derived their concept form ETH which ETH also derived its concept from a paper about smart contract.

@Abiky. I very much agree that the layers 2 on Ethereum will give much lower fees, however, there are presently many of them and the projects cannot collect as much users compared if they are on an integrated blockchain similar to Solana.

Also, what does this layer 1 on layer 2 model imply for Ethereum blockchain's value gathering? Uniswap has announced their own layer 2 on Ethereum. This will bring millions in onchain activity and profit from fees to Uniswap's chain and they will only pay less than 10% of their total revenue from fees to Ethereum blockchain very much similar to Base layer 2.



Today, we’re thrilled to announce Unichain. After years of building and scaling DeFi products at Uniswap Labs, we’ve seen where DeFi needs to improve and what’s required to continue advancing Ethereum’s scaling roadmap. That’s why we’re launching Unichain – a fast, decentralized Superchain L2 that’s built to be the home for DeFi and liquidity across chains.

Read in full https://blog.uniswap.org/introducing-unichain

Of course. It's all about convenience. People want low fees and fast confirmations even if that means sacrificing decentralization in the long run. But to those unaware, it's possible to get the same benefits as Solana on Ethereum by using any of its L2 networks. I'm talking about Arbitrum, Optimism, Base, and the likes. You will get the security, reliability, and decentralization of Ethereum without "breaking the bank".

Why switch to another chain with different apps and tokens, when you can stay on ETH and use a L2 for added convenience? At this point, it's hard to believe ETH will loose its position on the market anytime soon. It will remain the second-largest cryptocurrency in the world forever. Solana might even rise all the way towards the third spot. But that's it. "You can't beat the real thing". Not even EOS had success on "killing" Ethereum. Why? Because ETH has first-mover advantage. Just like Bitcoin. See you in the next bull market.

Both are working on something, and that's great.
Would Firedancer be something that would make the SOL chain much better (making many parts of technical processes better)? - definitely.
Would better and cheaper transactions make ETH better for its community? - definitely.
Both have something to work around and both would be leading the alt market, in my opinion.

everyone really knew that ethereum didn't have much network utility once they discovered the NFT's were not on chain. It was a transaction proof they were buying. No use case was discovered by the market.

@Abiky. You are correct that this very positive netflows on Solana is because of the memecoins craziness. However, this is not the 100% of the reason, I reckon. The much bigger reason is certainly because the people that have begun to use Solana pay much lower gas fees and the blockchain is very fast. If Ethereum's gas fees did not increase, will many people in the cryptospace transfer from Ethereum to Solana? I am very much certain that no, we would be on Ethereum blockchain for all of our onchain activities. This also is a supportive argument on the speculation that much of the users presently do not care about decentralization. They only want low gas fees and a fast blockchain.

It's all because of the "meme" coins craze. That, and also the excitement surrounding the sale of Solana's latest smartphone. The project is simply overhyped. It won't last for long. Especially when people tend to move on to the next big thing. Unlike Solana, Ethereum is focused on quality by providing safe and reliable decentralized apps to everyone. Fees may be much higher than Solana, but that's the price you pay for decentralization. You can always switch to many of ETH's L2 networks (Arbitrum, Optimism, Scroll, Base, etc) for complete peace of mind.

If Ethereum goes full speed ahead with the "Danksharding" upgrade, Solana's glory days will be over. ETH will be fast and cheap for payments like in the early days. Just you wait and see. Have faith in Vitalik for once, would ya?

Yes, SOL would be the nearest thing that could possibly beat up ETH in any aspect on which the thing i do like with SOL is that it is fast and have cheaper fees or simply better that on what we are seeing on ETH.
What makes ETH to be the #2 thing is that because of its smart contracts and this is something a feature that cant really be easily be beaten up on any projects out there. Yes, we cant be able to make out some assurance that it wont be overtaken by something on upcoming years to come but there's no guarantee that it will really be able to retain its spot forever, even we do say that Bitcoin would be always have also that tendency on getting replaced. It all matters with the community demand and recognition or simply into its supporters on which we know that this could really be that something that cant really be determined
on when there will be having that switch up in speaking about into the support on where its investors or supporters would really be pouring into. This is why it will really be that important that you should really that know
at least on the probabilities or chances that there might be some flipping in between projects. Therefore, it will really be best that you should really be making out some diversification in between coins/tokens on which you do really believe that it could really be having that potential that might be something big in the future or will really be having that tendency to be sitting in top of the ranks. It will really be just that everything depending into your risks taking and choices on where you would really be focusing into.

Yes, there is currently a conflict between "ETH as an investment" and "ETH as a successful smart contract platform".

ETH tokens' value does not directly benefit from L2's. So those in the ETH community which are more focused on the "investment" aspect (the "ultrasound money" camp, as @chainlinkgod puts it) are now angry with L2.

The "problem" is that it's a zero sum game: either you get more burnt fee tokens, or you get a more scalable platform. While they of course could fine-tune the fee (and perhaps also the PoS reward) algorithm, this would not move away the general dilemma.

I personally think the ETH folks should focus on the platform aspect. That's where they got big, and if they want to stay at #2, they shouldn't try to increase fees in any way or make L2s less attractive, only because they want a slightly less inflationary ETH token. So in the discussion I generally support Crypt0Gnome's position.

However, what both are missing is that ETH as a base token also perhaps needs new use cases, so it should not "only" be considered a gas fee payment means. This may be challenging as the "gas token narrative" has been upheld since the start.

I think this discussion is really interesting as it shows the discussions Bitcoin could also be heading into when BTC value eventually moves to L2s like it did on Ethereum. Bitcoin however has an advantage there: its base token is conceived as "digital cash" or "digital gold", but not as a "gas token", so BTC on L2s will be probably much more popular than the ETH token on L2s, where it's not really necessary as Zach wrote correctly.

There are always new coins coming along that are touted as Eth killers. So far none have lived up to the hype & Eth is still the number two cryptocurrency, after Bitcoin. Potentially Solana could compete with Eth eventually but at the moment I don’t see any existing option as an imminent threat to Eth.

It appears that if Ethereum will pump, Solana will pump higher and if Solana will dump, Ethereum will dump lower. This behavior has caused Solana to again reach another all time high against Ethereum. This is not a representation that Solana's price is being pumped, I reckon. This is showing everyone the reality that Solana is presently absorbing market share from Ethereum.

I am very much aware this Ethereum killer storyline is only something created by cryptonews media for clicks and attention, however, it very much appears that if this will continue, Solana might become no.2 in the cryptospace.

@d5000. On your speculation on DeFi using bitcoin, this will certainly be the biggest market pump that everyone in the cryptospace will witness if the bitcoin maximalists can be convinced to stop hodlong and begin to use their coins to participate in certain usages. However, there will be a gambling characteristic for this hehehehee. I reckon much of the hodlers very much discourage gambling and tell everyone to be like them, only hodlong.

Also, @chainlinkgod has written something on why the argument for ETH as the gas token for layer 2 is starting to crumble.



The thesis for “ETH is the gas currency of L2s” is starting to crumble, exactly as predicted and ahead of schedule

No I’m not bearish ETH, the economics of being a “gas token” just has zero moat and will be 100% abstracted away

L1 coins needs to be more than just gas money (SoV + cash-flows)

Yes I know this is a Paymaster solution and not native USDC gas payments, but we’re well on that way

Source https://x.com/chainlinkgod/status/1844907015740801141?s=12&t=fx2RmsbaS0qNJTJTdpNu2w



With Ethereum’s revenue dropping by 99% YTD, the ETH community has been experiencing an identity crisis of sorts

Namely, what is the primary method that ETH will accrue economic value?

In the “ultrasound money” canp, it’s all about revenue, more fees -> more burn -> deflationary supply -> number go up

But with EIP-4844 reducing DA costs for L2 rollups by multiple orders of magnitude, existing L2s now pay almost nothing to settle on Ethereum (at times less than 1% of fees generated)

Activity shifting from the L1 to the L2s means the baselayer has also been forfeiting MEV/sequencing revenue to the L2s, which their centralized L2 sequencers retains

Source https://x.com/ChainLinkGod/status/1832198208287863174

@bbc.reporter: Oh, you're correct, I had missed one of your posts on the first page. So I have to apologize

To add a personal opinion: I think currently the Ethereum killers in general have too much in common for one really to stand out. ETH has mainly the first mover effect, but network effect is already been challenged by Solana, albeit only in the short term. Solana has however still the problem with network outages. I think until this is not solved it will be difficult to catch up.

In general I agree however that there's the possibility that a different "season" could begin once the ETH challengers come closer.

Perhaps there will be even an unexpected competitor - Bitcoin itself. With BitVM it would not only be possible to create contracts with Turing complete characteristics but also Layer-2's without any additional consensus.

I don't think L1 contracts on Bitcoin will accrue too much importance due to Bitcoin's limited block capacity, but I can imagine a mid-term future with a lot of Bitcoin L2s with enhanced smart contracting capabilities and low fees. If Rootstock (RSK) for example moved to a decentralized BitVM-based model, they would bring already an existing ecosystem with them, so Bitcoin's smart contract landscape doesn't start from zero.

This could -- you'll be surprised to hear that from me -- even benefit Solana, at least for some time: if Bitcoin and Ethereum move both to L2-based paradigms, SOL's L1-focused paradigm would begin to stand out even more. Bitcoin with smart contracts running on rollups and sidechains would be similar to Ethereum's current emerging paradigm and thus this could challenge ETH's value proposition more than SOL's. However, as I already wrote the "everything on L1" paradigm is more expensive (for node validators) and inefficient (as a system) so I'm sure that in the long run SOL would also move to a L2 based model, losing its (sorta) unique feature.

@d5000. You did not see? The website on Artemis was shared already with the image of the netflows hehehehe. I was shaking my head on why you were implying that these netflows might not be real hehe. In any case, yes, there are cautious warnings for the Ethereum Foundation that Solana might get more marketshare from Ethereum. I hold cryptocoins of Ethereum and Solana, however, I am more bullish on SOL's price for this bull market.

On integrated approach vs. modular approach, I reckon there are advantages and disadvantages. But I am not arguing this. I am only speculating on netflows and what it might imply on Solana or Ethereum, if they are overvalued or undervalued. I reckon only the market can answer this.

Thanks! That's what I wanted to see I may not have found that metric because I was googling for "netflows" without a space

Yes, that numbers look indeed good for Solana, and if they sustain themselves then I agree that Solana may be approaching a new "season". I've played around a bit with the parameters. If we look at the past month alone (1M view) it seems that Ethereum had again more net flows than Solana. But that is of course only a short term picture, it will be interesting to observe what happens in the next months, if the big inflows into Solana were only due to the mid-year memecoin craze or if they can be sustainable.

An "integrated approach", i.e. a "big block" coin like Solana, can be attractive to create new tokens and contracts because of the lower complexity than a L2 (rollup) based approach. I continue to think however the L2 approach is superior because it simply isn't necessary to store every transaction on all nodes. Once L2s mature there should be possibilities to hide the L2 complexity from the end users. Even on Solana there seem to have appeared "network extensions", which are sort of L2s.

Interesting article on that subject: https://unchainedcrypto.com/are-solanas-network-extensions-just-like-ethereums-layer-2s-but-by-a-different-name/

I think L2 on ethereum is popular at the moment, with many using it, with the increased performance it is worth the effort, with layer 2 solutions making it easier for obtained  to build according to the needs required, because the process prioritizes speed.

I am not declaring that these are hard facts, however, if you were paying attention to what I was saying, I was speculating that this Ethereum killer storyline will have different seasons very much similar to a show on televsion. Read my original post.

Also, the only data I can provide as an argument that Solana might be the Ethereum killer is the data on netflows from this website.

https://app.artemis.xyz/flows

On Ethereum's high fees, if there are community members who like their high fees then this will certainly strengthen the argument for faster blockchains. Their rollup roadmap also appears to have become an opportunity for Solana to argue for an integrated approach and it appears to be working based on the positive netflows, venture capitalists are increasing, transactions are increasing, the community is growing and SOL/ETH is increasing. Let us eat the popcorn for the tv show hehehehehehhee.

I feel L2 on Ethereum better than many of the Ethereum killer. Though the fragmentation is hurting adaptation, Ethereum L2 are cheaper and faster than many other options and Ethereum Blockchain insures decentralization. Just tried Injective EVM, it happens in seconds and the fees are not even a cent for 10s of transactions.

No, of course. But it would make your point a bit clearer and more convincing if you provided some hard facts - completely independently from if you're a shill or not.

No, this was not an attempt to "weaken the argument", here you misunderstood. It's only that I am not interested enough in that metric to pay the package which includes "netflows", But as you do seem to have access (or know the numbers from another source), I've asked you to publish at least some examples for the netflow growth on SOL and the negative flows on ETH here. It hasn't to be a pic, only the % over the last month or so ...

I don't think that's bad. I know some Ethereum shills like their high fees on ETH because then many ETH get burnt in transaction fees and they think ETH gets "more scarce" due to this. However, if the ETH mainnet fees lower due to activity moving to rollups, then it will be again more attractive to move value on-chain on Ethereum's L1. This can have positive effects, and eventually will lead to a new equilibrium.

Compare that with Bitcoin, if people used Lightning more, then it would be better for those who like to transact on-chain, and I'm sure half of the forum would be happy.

That only seems bad if for some reason the "victim" was not freely able like anyone else to "hold" the "vampire", so maybe you are in essence pointing out that one chain ought to be able to hold shares in another as it were; if that capability existed then the main chain only suffered due to its failure of foresight to invest in the rollup project.

If the capability did not exist, then oops looks like you have pointed out a possibly rather important feature a chain/platform needs.


-MarkM-

Heheheheh some of your arguments are headshaking because you only make it appear that you are weakening the argument, however, it does not weaken this. Does an accusation that someone is a Solana shill really make the question of netflows and valuation of a chain invalid? It clearly does not make the question invalid.

Also on your other attempt to weaken the argument on netflows, if the source is a paid package, are you implying that the data on that website is not real? The negative netflows on Ethereum are not happening? Hehehehe another headshaking argument.

On Ethereum rollups, there are some people in the cryptospace who are beginning to speculate that these rollups might become vampire attacks on Ethereum mainnet. There was an article about the rollup of Coinbase where it earned $2 million in fees and it only paid onchain fees of $20,000 on mainnet.

On Ethereum vs. Solana and who will be no.2, I will certainly be watching. I am holding them hehehehhehehehe.

I repeat: arguments are normally more convincing if there are hard numbers backing the claims, and even a "shill" can be convincing in this case . That's what is missing here in this thread regarding your argument based on netflows. The indicator seems to be part of paid packages from on-chain analysis firms, and it's also not easy to find journalistic articles about the phenomenon you describe. The article you cite at the beginning doesn't mention it. So I'd appreciate (seriously!) if you can post some stats or charts here

I have seen some on-chain data like active addresses that look indeed very positive for Solana in the short term. But the timeframe for the observed growth, which is probably also what the VanEck report mentioned when it talks about "user base", is too short to be an evidence for undervaluation. If fees are low then also the potential for manipulation or use for useless tokens/data (as everybody can see on Bitcoin SV). And again, to compare with ETH you'd have to compare the whole ecosystem, including rollups and other "ecosystem chains" like Polygon.

btw: If anything I'm a Bitcoin "shill" or "bagholder", and a happy one (not only because of the recent price increase) If there's an ETH/SOL war about rank #2, then I'll be eating popcorn watching from the sideline

Heheheh it will not weaken the argument because your accusation that someone is a shill for Solana will certainly imply that you might be an annoyed bagholder of Ethereum. This will only distract everyone from the real argument which is based on netflows and what might happen to the future of Solana and Ethereum because of these netflows.

On overvaluing Ethereum and undervaluing Solana, I speculate that big investors and whales might have begun to notice these netflows and they are considering Solana to be undervalued if this is compared to Ethereum which might have a waiting value gathering problem because of rollups. The evidence of this is the growing community of developers, venture capitalists, investors and users.

Decentralized-in-name-only-proof-of-60%-premined-stake scamcoin that pretends to protect its non-existent decentralization with tps limit struggles against another scamcoin better at decentralization theater. You reap what you sow.

"you know right now bitcoin transaction costs 5 cents which is fine right now because paypal's fees are even stupider but the internet of money should not cost 5 cents a transaction its kinnda absurd" -2017 vitalik buterin

It seems to me that puts the blame onto the marketing industry.

It seems generally to be an industry that lacks sufficient faith in its own acumen.

I always find myself thinking why should I pay some marketer who claims to be able to make a coin soar if that marketer has too little faith in their actual ability to do so to simply go ahead and do so.

The programmers had enough faith in their own coding ability to write the free open-source code, why do the marketers lack sufficient faith in their own skills / abilities to go ahead and do their part?

I dealt with a marketer back when I was involved in setting up Mountnet Internet ISP in Halifax NS way back when (before search engines, basically) and one notable thing about the marketing department was what to actually offer for sale even is up to them apparently so there ya go, it is marketers job to figure out what to sell, get hold of some of it, and get out there selling it.

If teams won't listen to marketers to the extent of altering their product to become something the marketers figure they can sell, fine, lots of teams around, marketers can shop around to pick products they can sell.

So it seems to me it is probably more the marketers lack of faith that is the problem, they should be right in there snapping up dirt cheap coins and reselling them at much higher prices; maybe we need futures markets so the marketers can secure in advance a supply so that when their efforts do multiply the value they will still be able to pick them up themselves at known ahead of time prices to keep on selling them and presumably keep on multiplying the prices of them.


-MarkM-

Not that I'm aware of. EOS always had little demand and low network activity. It is now long lost and forgotten. This is the fate of all projects associated with Dan Larimer. Remember Bitshares and Steem? Their concept was good, but without a proper marketing strategy, investors will just look elsewhere.

If EOS (which was often proclaimed as the next Ethereum killer) failed, what can you tell me about Solana? It's overhyped, often becoming a victim of network outages. The only reason why hype hasn't faded away yet, it's because of the "meme" coins craze. Since SOL is fast and cheap to use, whales and speculators can use the chain to "pump" memes for profit. It will never beat Ethereum, no matter which shiny-new features it gets in the long run. To say Ethereum will fall, it's like saying Bitcoin will lose traction until it's superseded by another cryptocurrency. That will never happen. There's nothing wrong with holding coins other than ETH or BTC, though. The point is to make money, right? Just buy low and sell high for complete peace of mind.

At least it weakens the argument a bit and thus the arguments needs a bit more substance

When I shill for a coin (and I do shill for decentralized coins like XMR, LTC or so) then I'll usually provide some hard numbers to back up the claims. So you can do the same thing and your argument becomes stronger

Okay, thanks for explanation.

Now to answer your question about undervaluation: this metric seems to be indirectly related with value as a long term indicator for usage (these coins "could" eventually be part of the SOL demand), but not directly, because the value can simply stay inside the stablecoins without ever being converted into SOL. Many users might be simply using stablecoins on Solana due to the lower fees but would never exchange them to SOL.

A possible strategy to answer the question about undervaluation would be to compare the stablecoin trading volume on SOL versus the SOL price evolution. If the growth of this volume is higher than the price increase, then  I would say that SOL could be undervalued. The reason is that the stablecoins are actively traded for SOL and thus can indeed form part of the demand, and not only hodled in stablecoins (or used for stablecoin payments).

But as I wrote in the last post Solana has a long way to go to catch up to ETH in terms of market cap, so a long period of positive flows into the ecosystem would be needed.

Another interesting metric would be the value of all (or at least, all relevant, i.e. perhaps the top 50) tokens on ETH compared to those on SOL, including all second layers. If SOL's network value approaches the one of ETH then a "flipping" is possible in the medium/long term.

Are you implying that if you accuse that a person was shilling a certain project then the speculation on what chain is overvalued or overvalued based on netflows is invalid? Hehehe this is very much headshaking.

Also, netflows described that total value of stablecoins that are exiting or entering the network. There is also smart contract netflows shown in Artemis where Arbitrum and Ethereum have the largest negative netflows and Solana has the largest positive netflows.

@Abiky. You have mentioned Dan Larimer's EOS. Did EOS have this much positive netflows similar to Solana?

Do I smell a little shilling for a certain coin here?

If one coin has positive "netflows" (I guess you mean flows from exchanges to self-hosted wallets and vice versa) and another one negative ones, but the second one is 5* away, then it can take years to catch up, or never.

These flows are also more a sign for what's happening currently and what happened in the past, without much predictive value. Basically as in the last months the Solana flows were positive in comparison to Ethereum, this can be perfectly explained by the price movements of both coins in these months, where SOL did indeed increase relatively to ETH as shown in the graph in one of my previous posts. It could have been undervalued before that movement. But -- by far -- not enough to challenge it in the market cap indicator. SOL would need at least to come close to its old ATH.

Of course this positive SOL/ETH tendency can continue, but it's not sure. I would say there's a 60% probability perhaps that SOL will continue to increase compared to ETH in the next months because of its solid on-chain activity. However, much of the ETH movement can be explained with the negative reaction to disappointing ETF inflows, and this sentiment may bottom eventually.

As an example of the limited predictive value of flows, Glassnode failed with a lot of its Bitcoin predictions based on exchange flows, often its price went up after periods of negative flows, and down after periods of positive flows.

The last info I have is that "classic" sharding was relegated to the long term. In the short term however, ETH is relying on L2s, and rollups like Arbitrum and Optimism were quite successful and have lowered ETH's fees a lot in the last year. And in the medium term, a solution called Danksharding will be implemented, which will optimize the efficiency of rollups.

Maybe it is like SWIFT vs credit/debit cards.

SWIFT is apparently slow but when it comes down to something, somehow SWIFT is still used internationally between banks.

-MarkM-

@Abiky. Also, you might have forgotten an argument that is beginning to be much more agreeable. This argument is the people who use defi, who play games on blockchain, who trade on decentralized onchain exchanges and other types of onchain participants only want to have cheap fees and a good experience. Does Ethereum give this type of good experience? We can be quite certain the answer for this is it ca mot because it is very expensive to use.

On the other side of the argument, why is Solana getting very positive netflows? This is certainly because Solana has attention of the community and very much might continue to have this attention. This forced developers and venture capitalists to invest their time and money on bringing more development on Solana than on Ethereum, I reckon.

Nobody cares about the damaging effects of centralization. Everyone just wants to make money. Investors buy a coin with the hopes of turning a profit in the long run. Only true crypto enthusiasts and libertarians are interested in decentralization. Solana may be centralized, but it's far superior than Ethereum in terms of performance and cost-efficiency. Of course. This leads to network stability issues in the short term. Why do you think Solana has been a constant victim of network outages? Ethereum has been running smoothly since day one. I know there was a "rollback" of Blockchain transactions in the past. But it was all done in good faith to help protect investors. Miners agreed to it, and developers made the move.

You won't find any other altcoin as reliable as Ethereum is. The high fees and slow confirmation times is the price you pay for unmatched decentralization, security/reliability, and censorship-resistance. Same goes for Bitcoin. Any project that claims it's the next "Ethereum Killer" would be nothing more than overhyped. Remember EOS? That used to be the "Ethereum Killer" until people got tired of it and moved on to the next big thing. I'm guessing history will repeat itself with Solana. Just you wait and see.

Does this imply that Solana is very much undervalued or it might be Ethereum is overvalued? If this positive netflow on Solana will continue while the negative netflow on Ethereum will also continue then it appears that the market capitalization on one of these blockchains is a mistake hehehehe.

Also, what is the latest news update on Vitalik's sharding? Is he continuing this to be his solution for scaling Ethereum?

Even though there are also other good candidates in this regard but I also think that Solana is far better than them. It is because it is also bulkier other than just being popular and has the same use case as ETH.

It is sad to know that there are devs who are only after the money, in a way that they will dump most of their coin/tokens supply but even them, they also believe on their project that it will rise in value because that is the only way for them to profit. I do not know if it's really true that ETH dev (Vitalik Buterin) is dumping its ETH to the max level but even if let say yes, I'm still quite impressed to the fact that he keeps on developing it and didn't drop his project right after profiting just like the others out there.

Yes, you may be correct that some investors and developers may not care about centralization risks.

However, Solana has still to do a huge amount of catching up with Ethereum. A *5 of the market cap -- assuming that Ethereum price doesn't increase anymore -- isn't an easy task for an already somewhat established altcoin like SOL which is currently struggling to reach even towards its old highs of >$200. I think it could be easier if Solana had some "real" technical advantage which was impossible to copy on ETH without changing it completely. But ETH itself is moving towards a layer-2 fueled high TPS model via its rollups.

I think if SOL achieves to get at least close to 30-40% of ETH's market cap, then the technical concept to achieve high TPS will probably be discussed ferociously in the altcoin community, and the winner could depend on the answer which one is "better" "objectively". And I think that a L2-fueled model is indeed superior as simply it has overall inferior costs and can scale much, much better. On a L2-fueled blockchain in theory each citizen on the earth could release their own token. The tradeoff - complexity - can be hidden via the interface once the tech matures.

For me it would be interesting what happens if SOL (or any other "ethereum killer", TRX for example is growing much faster than SOL but has a lower marketcap) and ETH come closer though, if ETH is able to defend its position or if ETH investors tend then to panic and sell more coins when the #2 status is seriously challenged. I'll be eating popcorn at the sideline

Well I suppose that as long as this planet is what the Traveler RPG would call "balkanised", government is itself decentralised, not sure if that makes it "fair enough then" though.

-MarkM-

On centralization and higher transactions per second, I very much understand and I very much agree on the argument. However, my argument is that it appears that no one is anymore considering this as an issue. After Ethereum's DAO hack, the argument for developers presently is if a blockchain is attacked or hacked, the development team can reverse transactions and continue very much like nothing has happened hehehe. Also, development teams can hire lawyers and they appear to that they can get help from the government to prosecute hackers.

In any case, we can witness that developers, users, investors, venture capitalists and other people causing high net inflows on Solana do not anymore care about some centralization. They want a blockchain where they can use it cheaply and create projects that are not restricted by low transaction capabilities.

Maybe "don't beat them join them" could come to mind here?

Things like GRouPcoin, DeVCoin, IXCoin, I0Coin, heck even NaMeCoin, by merged-mining alongside bitcoin, seem to present a possibility of provisioning a bit of bandwidth for themself and not actually competing with bitcoin but, rather, simply offering its miners some potential extra income?

I have not tracked what has been happening with merged mining alongside litecoin but maybe it is time for the original scrypt coins, TeneBriX and FairBriX, to look into merged mining too if they didn't already?

-MarkM-

I was there for the flippening and rippening moments and none of them happened and a lot of Ethereum and Ripple fanatics have abandoned the idea for now because they have bigger problems competing with these newer horses like Solana/SUI/aptos, etc than to compete with Bitcoin and lose (again).

Having high TPs right now is a meme because everyone knows that if any of these chains handle anywhere near the volume that Bitcoin or Ethereum faces, they'll bend the knees as well. Solana itself has been down close to 5 times over the years and they had to *restart the blockchain * to get it work again.

No problem


Source: Coingecko

The violet line is the SOL/ETH price, the orange line SOL/BTC and the light blue line SOL/USD.

We can see here clearly that SOL has indeed grown a bit compared to ETH this year, and it is close to the SOL/ETH all time high. However, the growth is not enough to even see a "flipping" in the smartchain market on the horizon. Ethereum's market cap is almost five times higher than Solana's, despite of the relative loss.

And since March Bitcoin has outperformed both ETH (by a lot) and SOL (slightly, and with some volatility).

I chose the "max" view to put things into perspective: SOL had a very high growth in 2023, but the reason is simply the fact that from the 2021 high it fell extremely low (95% loss). It's however true that SOL is currently one of the few Ethereum killer chains of the "second tier" which has made some progress lately in the "Ethereum killing" process. The other one is Tron (TRX). Avalanche and Cardano for example are stagnating, and BNB and TON in my opinion are "company coins" and thus do not really compete with ETH nor SOL which can be described at least as semi-decentralized.

One that is growing lately is SUI, a coin afaik derived from Facebook's failed Libra, but it's still relatively far away (ranking currently at #25) and I don't know if the smart contract capabilities are comparable to the EVM chains.

That does sound like a server most people won't feel likely to run in their own home, which means not having control of physical access and possibly not even knowing the skillsets of those who do have physical access enough to judge whether any are technical-skilled enough to be a potential threat if left alone for a moment with a virus medium or left long enough to reboot using a boot media, thus yeah, sounds too centralised alright.

As to how the values have been lately too bad you didn't put a nice vs-bitcoin chart like you have on other occasions done.

-MarkM-

The discussion about TPS is missing the point that TPS is always a function of centralization. The more TPS a layer-1 blockchain claims to allow, the more capacity/bandwidth/CPU/RAM requirements for full nodes. You have to pay a quite high performance computer already to operate an Ethereum full node, but with Solana "at full capacity" it is even worse. Solana compared to Ethereum has basically the same relation as BSV to Bitcoin.

For a simple SOL node you already need 128 GB RAM and a 12-core CPU and a 10 Gbps network connection, so called "RPC nodes" (which are the real full nodes) need even more. ETH "only" needs a 16GB RAM computer (see here), while a Bitcoin node can run still on the year-long standard of 4MB RAM. SOL claims to have >4000 nodes, but that number seems to include light nodes (correct me if I'm wrong here) which process the blockchain in real time but don't store it fully.

Ethereum is increasing its capacity via Layer-2's, like Bitcoin, and this is the way to go IMO. Not every tiny speculative memecoin transaction or every cup of coffee bought has to be recorded by all full nodes on the world. It's just a matter of resource allocation. I'm myself not a big Ethereum fan but even less a Solana (and even less a BNB/Tron) supporter.

If really Solana had discovered a breakthrough in bandwidth usage that can often be adopted by other blockchains like ETH and BTC too.

I also distrust predictions from such an "objective"    source like VanEck which are those who have applied for an US Solana ETF.

And at $143 SOL is quite far away from its ATH of $260 (current price is 55% of its ATH). Not much more than Ethereum (currently $2450, ATH $4800, so it's at 51%).

It is very headshaking to compare Ethereum and Bitcoin because they have very different capabilities and use cases heheheh. They will only be comparable if smart contracts, DeFi and NFTs will be very much active in Bitcoin which would certainly be quite an annoyance for much of the people who use and hold Bitcoin. We can be very certain of this and we have witnessed this when Ordinals had a few months of popularity.

However on Ethereum, they experience this everyday and they will experience this until much of the people will stop using it. Also, your argument change does not the reality that much of netflows are going out of Ethereum and they are going to Solana.

Yes. Seeing a founder dumping his own coins, tells me he stopped believing in it. At least, that's how I see it. Litecoin founder Charlie Lee, did the same. The only one who's still "hodling" is Satoshi. Who are we to judge, anyways? Whenever we like ETH or not, it's the one cryptocurrency that started the Web 3.0 craze. Without it, we wouldn't have decentralized apps, tokens, NFTs, etc.

I know ETH is expensive and slow at times, but no other altcoin can outmatch its level of security and reliability. If developers continue to work on it, nothing will stand on its way. Hopefully, ETH improves enough to handle a large number of transactions per day. L2 networks are just a short-term fix. The future is unpredictable, so I'd hope for the best.

High fees happen in bitcoin too, it does not necessarily mean the layer zero is shaky or insecure, rather it might indicate quite the opposite.

If ultimately the zero layer is to be where the multi-billions-fiat value balances of payments between "civilisations" and other forms of billionaire and trillionaire and such are to take place, maybe all the block space it will really need is one transaction per year or so per multibillion layer 2 network as the big "civilisations" et al balance with one-another's net trade gain or loss at their year-ends, and maybe the free transaction part of each block (if there even is such a part anymore?) offers occasional slots for other layer-2s that have backlogged enough transaction volume, rollups etc to find it worth trying to get a transaction into a layer-zero block.

If people are actually willing to pay high fees, as evidenced by those fees are getting paid, that seems to me to imply someone is actually valuing the chain they are paying such fees to get a transaction into...

-MarkM-

to be fair, Solana also has occasional unlock, but it's small enough for it to be relevant, but yeah, Ethereum's founder dumping ethereum just give pessimistic impression to the holder.
I also personally hold some amount of ETH back then now completely shifted my portfolio to solana, though I'm also waiting for it to dump as well to add some bags.

honestly, not really interested in ETH anymore, the fee problem still as annoying as ever added with the massive L2 that's spreading the liquidity to various L2 chain making TVL spread thin.

at some point, I really believe that solana will truly replace ETH if this keeps up though.

Yes, however, it does not appear to matter for the community of developers, venture capitalists and users of Solana hehehe. I have already shared the netflows on Solana and it has most of the netflows going into their network and Ethereum has the most of the netflows going out of their network. We cannot argue against netflows of money and this might be showing the future for the next months of 2024 and what might happen on 2025.

Also, have you tried onchain trading or send tokens on Ethereum. They fees for trading on Uniswap is more than $15 at present and for sending ERC20 tokens this is more than $5. This is very headshaking if people will continue to use this.

Oh dirty trick! Well played!

Wasn't he, though, supposedly trying to help it by setting it free-er to become less potentially centralised, if not quite as well playing that as Satoshi did being as how it was a little late in the game to magically turn out to have been anonymous all along?

-MarkM-

I believe Solana has the capacity to flip Ethereum. At least the owner and lead developer of Solana believes in the project unlike Ethereum where the owner Vitalik Buterin is dumping ethereum

Well, the makers of "Firedancer" (a third party node software for Solana) claim it will make SOL more reliable for daily payments. It will solve the network outages once and for all. If true, Solana would be poised to take a large share of Ethereum's market dominance. But that's it.

Regardless of how Solana improves, Ethereum will still remain #1 because of its first-mover advantage on the market. Just like Bitcoin. Again, VanEck is being too optimistic. This is expected from a company who's heavily-invested in the project. The market will decide which coins stay afloat and which ones will die in the long run. As long as there's demand for SOL, don't expect it to go anywhere soon. Who knows what the future holds for the cryptocurrency?

Maybe it is coming to be, or coming toward, time to improve terminological precision.

If one were to utilise, say, three terms: altplatform, altcoin, alttoken...

Might it not turn out to be the case that although ETH is the number one altcoin...

...Bitcoin could be fighting to become the number one altplatform?

(Implying, of course, that ETH is no altplatform but the platform to which others are alt.)

((For any insufficiently advanced bots: duh yes I mean bitcoin is not number one vs eth as a platform.))

-MarkM-

Isn't Solana the same project that has been down for hours several times? And if there is a huge increase in smart contracts, the blockchain will stop and transactions will not be processed? The bet on Solana comes from the fact that its price has increased recently, and if the same thing happened to projects like ADA or DOT, you will find similar articles, but in the end, Ethereum's value is still far from all altcoins.

I appreciate VanEck's enthusiasm. But the thing is, Solana isn't as reliable as Ethereum is. It has been a constant victim of network outages in the past. Besides, Ethereum is the one smart contract platform that started it all. The concept of Web 3.0 wouldn't have existed without Ethereum. It's a blockchain network that has an ever-growing ecosystem of dApps, tokens, and services alike. The EVM has been tried-and-tested over the years. Solana's EVM counterpart is just getting started. How could it reach a market cap half of Ethereum's? I'd say that's impossible.

Right now, SOL is being heavily-used for the issuance of new "meme" coins (tokens). All of the buzz are on "memes" such as WIF, BONK, and the likes. NFTs are still dominant on the ETH blockchain, despite SOL's performance and cost-efficiency. The market will decide which coin stays afloat, and which one will go all the way down the drain in an instant. With ETH getting cheaper and faster to use thanks to subsequent network upgrades, what use will alternative L1 networks like Solana have? Just my opinion.

Agreed. This is certainly why I mentioned that it appears to be something similar to a Netlfix show that has different seasons hehehe. This blockchain killer storyline has become a bull market indicator because this has been repeating during each beginning of a bull market.

@o48o. However, higher TPS is beginning to be an important argument for the success of other blockchains. The developers who created Arbitrum, Optimism, Base, ZKsync and these layer 2 blockchains have confirmed the argument.

Also, Solana cannot be compared the to vapor Cardano hehehehe. Much of the inflows for 3 months have been going to Solana, more developers are also going in Solana to create their dapps that need higher TPS to be useful for the people and their community has presently become much bigger.



Source https://app.artemis.xyz/flows

Haven't we already gone trough the fact how TPS is a terrible metric to use?

I don't have anything against SOL but just looking at transaction capabilities and fees is a lazy augmentation. Imho it's better to focus on the growing community and chart, because those are interesting and makes it more appealing to buy than eth.

But then again, i can't say i like lots of the winners in the chart these days, like bnb is near ath and trx has broken the ath while ago. I rather had all memecoins in top 10 and embrace the nonsense to be honest.

I think solana has always have that thing required to surpass ETH at some point.

the community is so solid and everyone is bullish about the platform, moreover unlike ETH where they offload their scalability problem solana looks like it's doing quite well with the scalability issue, no need for L2 at all which in a nutshell just funded massively by venture capital and angel investors.

at some point I also think that solana ETF if ever approved will be huge, unlike ETH where the ETF just have too much outflow day by day LOL.

Personally I've invested some in solana, hopefully it yields great in the future.

It is interesting to follow the latest report from VanEck which predicts that Solana could reach a market capitalization of 50% of Ethereum. If the $330 price prediction for SOL comes true, this will certainly be a major development in the crypto world. However, as you mentioned, this report could trigger a negative reaction from the Ethereum community, especially with the always touchy “Ethereum killer” narrative.

Solana is superior in some technical aspects such as transaction speed, lower fees, and a rapidly growing user base, but Ethereum still has a much more mature DeFi and NFT ecosystem. Most likely, this development will create increasingly intense competition between the two, similar to the serial drama that develops during bull markets.

I don't know mate,  throughout crypto's supposedly storyline, there are not success so far,

a. There is this thought that Ethereum is the so called Bitcoin killer, as it overtake Bitcoin in early to mid 2018, but that didn't happen, and others dub it "the Flippening"

b. Ripple as well, in the same breathe that time, that it will overtake Bitcoin, "The Rippening" as they dub it.

Both didn't succeed, so I doubt that by 2024, we could be hearing this so called "X" killer mentality, in my opinion. SOL is just hype, just like ADA in 2020 and others who had their chance to challenge Ethereum before.

It appears that this storyline of Ethereum killers will come very much similar to a Netflix show with different seasons during bull markets hehehehe.

The report is very simple and short, however, the title will be very much disliked by the Ethereum community.



Solana’s technological prowess could propel its market cap to reach half of Ethereum, according to a recent report from VanEck’s Market Vector. The report also projects that Solana’s price may rise to $330, which means an increase of over 50% from its current level.

“Based on third party research, Solana has the potential to reach 50% of Ethereum’s market cap, with predictions placing SOL at a price of USD 330,” the report wrote.

“These forecasts are derived from technical models available on platforms like TradingView, suggesting a possible seismic shift in the cryptocurrency landscape if this market cap increase occurs,”

As detailed, the layer 1 (L1) blockchain outperforms Ethereum in terms of key metrics like transaction capabilities, user base, and transaction fees.

Read in full https://finance.yahoo.com/news/solana-could-hit-50-ethereums-200600304.html



This is the report from VanEck and the source of the article.

https://www.marketvector.com/insights/mvis-onehundred/eth-vs-sol