JP Morgan Chase says Ethereum’s 70% DeFi market share could continue to decline until the final stage of Sharding is completed in 2023.
Analyst Nikolaos Panigirtzoglou notes that scaling is vital for Ethereum to remain at the top of its game, but it could be behind schedule.
JP Morgan observed that the share of the total value locked in Ethereum has dropped by 30% from almost 100% in 2021.
Panigirtzoglou sees the situation worsening since Ethereum is losing its market share to independent chains and not to its layer two scaling solutions.
JP Morgan remarks that networks like Terra, Avalanche, Solana, and Binance Smart Chain are quickly closing the gap, and Ethereum could find it hard to reclaim its popularity once the scaling is completed.
The dwindling craze around the Ethereum network could adversely affect the price of Ether which doubled last year.
ETH surged 220% in 2021, which is minimal compared to Solana’s 7,000% and Avalanche’s 2,200%. The token performed better than BTC in the same period.