Despite the high gas fees and network congestion, Ethereum is showing a bullish trend for the long term. This optimism comes from borovik.eth, a Rollbit partner, who shared his thoughts on December 26. He highlighted Ethereum’s thriving developer community, its significant role in the blockchain world, and the emergence of various Layer-2 solutions (L2s) as key reasons for this positive outlook.
Can Layer-2 Boost Ethereum to New Heights?
Borovik.eth is confidently bullish about Ethereum’s future, even as other cryptocurrencies like Solana (OSL) and Cardano (ADA) have been making waves in 2023. He believes that Ethereum’s scaling issues are solvable and expects developers to find long-term solutions. This optimism is rooted in the ongoing development of Layer-2 scaling solutions, which are crucial for Ethereum’s growth. Big names like the crypto exchange Coinbase and venture capitalists are backing these developments, indicating a potential bull run for Ethereum (ETH).
As of December 26, Ethereum is experiencing an uptrend but is cooling down after significant gains in the last quarter of 2023. Although Ethereum’s price is lagging behind some other platforms, it’s still showing promise. If Ethereum can break past the $2,400 mark, we could see it soar towards $3,500 or higher in the coming months.
The rise in Solana’s value in the second half of 2023 has led to comparisons with Ethereum. However, many traders remain optimistic about Ethereum’s prospects. For instance, Arthur Hayes suggested that investors should start shifting their funds from Solana to Ethereum, underscoring the value of the latter.
Ethereum’s Layer-2 Solutions: Managing Over $18.8 Billion
In the face of on-chain scaling challenges, Ethereum developers have been actively working on solutions. The introduction of layer-2 options using rollups is a significant step in this direction. Protocols like Arbitrum and Optimism are reducing the mainnet’s load and consequently lowering gas fees. Currently, layer-2 protocols manage an impressive total value locked (TVL) of over $18 billion, with many active and upcoming projects.
Coinbase is one of the major companies taking advantage of these Layer-2 solutions. Through Base, they offer cost-effective transactions while maintaining security through the Ethereum mainnet. Over 60% of Base’s revenue reportedly comes from rollup fees, showcasing the significance of their scaling solution and Ethereum’s role in it.
Looking ahead, the Dencun Upgrade, planned for integration next year, is set to further reduce layer-2 fees. Developers are aiming to roll out this update on the Goerli test network as early as mid-January 2024.
Disclaimer: This information is for educational purposes and does not represent any investment advice. It’s always recommended to conduct your own research before making any investment decisions.