Panic as Ethereum Loses DeFi Ground to Rivals

The year 2021 has been great for cryptocurrencies, especially Bitcoin (BTC). Decentralized finance (DeFi) and Ethereum have also joined other cryptocurrency niches to record enormous growth, especially in terms of engagement, popularity, and sheer volume. According to DappRadar, the total value locked in DeFi currently sits at about $56 billion.

Similarly, non-fungible tokens (NFT), is also experiencing record growth. Many people predict that 2021 will be a great year for the NFTs. However, DeFi —especially on Ethereum’s blockchain — has continued to thrive, and its user and developer activity now surpasses that of other blockchains.

However, it is no longer a secret that Ethereum has reached a decisive point. High gas fees and congestion have plagued the network and made decentralized exchanges (DEX), too expensive for common users interested in making small and medium-sized trades. It is not surprising for even simple transactions to cost over $10.

SushiSwap Seeks Alternatives 

On March 3, 2021, SushiSwap announced that it had added to its platform a number of Ethereum alternatives and deployed contracts on Polygon, Binance Smart Chain, Moonbeam, xDai, and Fantom.

This move by SushiSwap was heavily criticized by the community, including Uniswap founder, Hayden Adams. 

Nevertheless, the project turned out to be a big success, becoming the second biggest DEX by volume. SushiSwap now provides its users with new Ethereum alternatives and spares them the huge gas fees that have become the norm.

More DeFis Follow Suit

More projects seem to be shopping around for Ethereum alternatives, although they are not planning to give up on Ethereum. Instead, they are adding a number of other alternatives, a major game-changer for popular blockchains like Binance Smart Chain.

Balancer recently announced its intention to deploy ports onto Polkadot and Mooonbeam.

Further, exchange aggregator 1inch recently added on its platform support for Binance Smart Chain. Its users can now change networks and enjoy faster transaction times and lower fees.

Enter Ethereum 2.0

With its scalability issues, Ethereum is becoming hard to use. However, the sharding and staking of Ethereum 2.0, currently being developed, promises to normalize users’ experience on the platform. 

Views and opinions expressed are solely those of the author and not of The DeChained or any affiliated party. Views or opinions expressed in this article (or any article on the website) are not financial advice. Articles are for informational purposes only. The author and The DeChained may hold positions in assets discussed in this or other articles.
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