Ethereum’s Decline Sparks a Competitive Race Among Layer-1 Blockchains

The dominance of Ethereum among layer-1 blockchain networks has diminished, leading to a competitive landscape where multiple networks are vying for the top spot as the primary Web3 platform, according to Alex Svanevik, CEO of Nansen. While Ethereum remains the most widely used layer-1 network, with around $52 billion in total value locked, accounting for approximately 51% of the total on blockchain networks, its market share has significantly decreased since 2021, when it controlled up to 96%. Svanevik stated that the current environment is an "open race" among several layer-1 chains, with smaller networks experiencing rapid growth and a handful of them emerging as potential leaders.

Solana, known for its faster transaction speeds and lower fees compared to Ethereum, is currently positioned to be the next major Web3 chain. It has surpassed Ethereum in key on-chain metrics such as active addresses, transaction volume, and gas fees. Although Ethereum still leads in total value locked and stablecoin issuance remains robust, Solana's growth is undeniable. Additionally, numerous smaller layer-1 networks are competing for market share, but many are gaining popularity mainly during bullish market phases and hype cycles, rather than through sustained adoption.