Crypto moves fast, and windows flash by. Throughout 2021, a narrative became popular, and for good reason: its story was violent, compelling, and based on true events. The tale in question was that Ethereum was about to become the victim of a murder, and the only unclear feature was the identity of the killer.
A line-up of suspects assembled, but an unusual aspect of this thriller was that rather than the plausible culprits protesting their innocence, those in the spotlight were making bold, gangster claims: that it was they and they alone who had the capacity to finish Ethereum, and that they would dispatch it without mercy.
These were the Ethereum killers. Alternative layer-1 blockchains that operated as smart-contract platforms, and could replace Ethereum as the world’s decentralized computer, powering web3 and its applications in the near future.
Take your pick from Avalanche, Terra, Fantom, Solana, Cardano, BSC and more. All are different in some ways and similar in many others, and all make the same fundamental claims. They can do everything that Ethereum can, but faster, cheaper, better, cleaner, smoother, more shinily and while sipping silently on a gin martini.
And, maybe they can. Take them for a spin and you’ll see: they work. But, importantly for traders, killing Ethereum was a killer story, the genre of the moment, and could guarantee some gains. If you weren’t sure which one to flip, then just flip them all because they’re all pretty good. So far, so profitable.
So indistinguishable. So, what happened? Shouldn’t Ethereum be dead by now, having had that pack of assassins on its tail, crowing about how they were thirsty for blood and coming for the crown, and wouldn’t even charge for gas?
And yet, last time I checked, Ethereum remains not deceased. Vital signs all good. Still not transitioned to proof-of-stake, but--as always--working on it, and doing good numbers when it comes to wallets, developers, and total value locked, not to mention less directly tangible facets, such as status and trust.
And, this is all along with a value that none of its competitors, with the exception, in part, of Cardano, can lay claim to: it has survived, and survived very near the top, for a significant amount of time, and the longer it is around, the more likely it will stay around.
The sense now is that perhaps the window of opportunity has passed, and the story is changing. If Ethereum was going to be usurped then, while its toppling might not have fully unfolded yet, there would at least by now have been a first act, and signs that the crux was coming.
That, though, hasn’t happened, as Ethereum continues to be built on and utilized, is the go-to choice for smart contract work, and remains the only crypto besides bitcoin that people who are not into crypto might have heard of or considered buying.
There are still new layer-1 alternatives picking up attention, such as NEAR Protocol, but at this stage, are their distinguishing characteristics really going to propel them to perform any better (or worse, or noticeably differently), than the other layer-1 alternatives we already know about?
This is not to say that Ethereum's competitors won’t, in the medium term, go up again in price. Solana, Avalanche et al might recover and surpass previous all-time highs. But, only if Ethereum does, and probably at exactly the same time.
When it comes down to it, how many alternative layer 1s do we need, and is it worth the time investment of learning about how they all work and their complex ecosystems when Ethereum is as much in control as it ever has been?
One argument for figuring them out is that there are lucrative opportunities to be found in some alternative DeFi environments, and in some cases around NFTs too. In that case, perhaps it’s worth going ahead and reaping the rewards. But, these opportunities, though interesting, don’t imply that there are any significant threats to Ethereum’s long-term prospects.
The Ethereum killer storyline may not have run its course just yet, but it can’t carry on forever, and there will surely be other plotlines that offer more variety, and start to attract those looking for original, high value approaches.
A key play may be in the field of NFTs, as tokens come to be used, a la Moonbirds, to raise investment and drive hype around ventures that look something like web3 startups. Also, in the NFT corner, there are likely to be big-budget corporate projects coming into the space and grabbing attention.
Such developments might take place on alternative layer-1s, but the odds are that it's Ethereum that will carry the majority of NFT traffic and that fresh narratives will not be focused on alternatives, nor on Ethereum itself, but rather, will revolve around the projects being launched on Ethereum, at which point, Ethereum's position looks locked in.
Perhaps there’s to be an unexpected twist and a chapter no one saw coming, but as we hurtle through 2022 it feels as though the opportunity for a kill shot. If it was ever more than just fiction, has already been left behind.
