Founder Vitalik Buterin’s Blockchain remains the measure of all things.
For all the talk about “Ethereum killers” in the 2021 bull run: Aside from Bitcoin, Blockchain remains the measure of all things, especially in the course of this ruthless bear market. It leaves Solana, Avalanche, Terra, Fantom, and others far behind in the rearview mirror.
At the start of the year, it was clear that Ethereum still had a lot of work to do before the second-largest Blockchain by market cap could be considered mass adoption. The results had to follow last year’s promises this year.
Additionally, then there was this too, not just with the long-awaited Merger. Although the price took a different direction in 2022, the cryptocurrency is ending the year better than its price suggests.
Price Falls, Network Grows (Q1)
In the first quarter of 2022, Ethereum saw massive gains in network revenue, as compared to the same quarter last year, as well as new records for engagement and daily active addresses.
The focus of Ethereum and the crypto community, in general, changed towards the end of the quarter, in the biggest event of the year: the change of the consensus mechanism, also known as “The Merger”.
When to Merge? (Q2)
The project’s developers put the brakes on their supporters in April: the switch from proof-of-work to proof-of-stake was postponed. The “difficulty bomb”, which was supposed to be a time-controlled compulsion for miners to switch, was also postponed and fueled fears that ETH 2.0 would not work this year either.
Barely a month after the Terra crash, the crypto market was once again on the brink of a crash. For Ethereum, it meant reaching the (provisional) annual minimum by 2022. At around 880 US dollars, the course marked the “lowlight” of the year. This is a quarter to forget.
Is Ethereum Too Centralized? (Q3)
After the shock of the collapse of Terra, as well as the bankruptcy of Celsius and cryptocurrency hedge fund Three Arrows Capital, Ethereum, along with the rest of the cryptocurrency market, was able to catch its breath in late July. The announcement of a fixed date for the Ethereum merger contributed, among other things, to the price recovery.
So, on September 15, a few days earlier than expected, at 08:44 in the morning, the developers successfully kicked off the Ethereum 2.0 era.
As a result, the ETH payout plummeted, lowering the price of network backing and increasing selling pressure. More importantly, changing the consensus mechanism meant a 99 percent reduction in power consumption.
Suddenly, the “Ultra Sound Money” Blockchain not only became interesting to ESG-conscious investors, it even caused “energy waster” Bitcoin to have a hard time.
Facing the Future (Q4)
The fourth quarter evolved into the phase of Layer 2 Blockchains, which could be another driver of mass adoption in the coming year. The ultimate goal is to reach 100,000 transactions per second on Ethereum, a task that is now an integral part of the Ethereum roadmap.
Technical innovations, “ultrasonic tokenomics” and the DeFi sector as a driving force should ensure that Ethereum stays closer than ever on the heels of the king of cryptocurrencies, Bitcoin, next year.
By Audy Castaneda
