Analysts at global banking giant JPMorgan say Ethereum’s competitors will challenge the top altcoin’s DeFi dominance in the crypto market this year.
In a recent report, analysts led by JPMorgan CEO Nikolaos Panigirtzoglou said that ETH’s 70 percent market share in the DeFi area will continue to decline as the blockchain sharding upgrade remains at least a year away.
Eth’s market share in the DeFi space has dropped 30% since January 2021.
“We see that the optimism of the ETH dominance rate is in jeopardy. This is because the scaling of the Ethereum network, which is essential to maintaining the dominance of the network, may come too late. “
According to Panigirtzoglou, Ethereum competitors such as Terra (LUNA), Solana (SOL), Avalanche (AVAX), Fantom (FTM), Tron (TRX), Layer 2 scaling solution Polygon (MATIC) and Binance Smart Chain (BSC) are gaining Market shares from the second largest cryptocurrency in terms of growth from its introduction.
Additionally, according to the report, some developers may never return to ETH once the sharding upgrade is complete.
“The relative valuation of Ethereum compared to its competitors reflects the declining DeFi market share. The risk for ETH is that by the time sharding is implemented in 2023, the competitor’s ecosystem will have grown so much that no one wants to return to the Ethereum network.
Ethereum is trading at $ 3,111 at press time, 30% off its 30-day high of $ 4,439.
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