Author: Haotian

Following this discussion, I will add my thoughts on the current dilemma of Ethereum @VitalikButerin, as follows:

1) The "ivory tower" thinking model binds innovation: the Ethereum Foundation (EF) has a stock that is separated from the market from 2020 to 2024, constantly stacking technical concepts and ignoring the real needs of users. Faced with the sky of criticism and direction guidance, EF management chose to "ignor", which led them to miss the critical time window to fix the problem, allowing high-performance chain competitors such as Solana and Sui to get rid of the oligopoly effect of the Ethereum ecosystem and grow wildly;

2) Overstack of technical narratives has caused market fatigue: from DeFi, NFT and various Layer 2 expansion solutions, the Ethereum ecosystem is like a narrative production factory, constantly launching new technological narratives, but failing to form effective value capture. This leads to users gradually feeling tired of this purely technological orientation but not reflecting the development path of ecology and currency prices. Ethereum has always hoped to stimulate the market building boom by stacking high technical thresholds, but it has proved that relying solely on technical narratives is difficult to support sustained market prosperity;

3) The Layer 2 strategy leads to ecological division and liquidity dispersion: Although the Layer 2 projects such as Optimism, Arbitrum, and Base have solved certain expansion problems in technology, such as the Gas fee is reduced to the insensitive level and TPS has also increased significantly, it has caused the complex abstraction of user experience and excessive liquidity dispersion. The compatibility issues of cross-chain standards between various camps native to OP Stack, ZK Stack, and Ethereum are not only caused by the compatibility of cross-chain standards, but also the interoperability barriers to interoperability have made these market darlings who once issued coins for issuing coins. Not only did they not bring effective nourishment to the Ethereum ecosystem, but they instead caused the continued sluggishness of the Ethereum ecosystem;

4) $ETH Value Capture Model Failure: After the implementation of the EIP-1559 destruction mechanism, the value capturing effect of ETH failed to continue to work as expected. ETH lacks a value accumulation mechanism that is directly linked to network usage, and the layer2 market's prosperity has not been fully transmitted to the main network. The idea of ​​modular architecture advocates the separation of the basic layer and the application layer, resulting in ETH becoming the basic infra settlement layer rather than the necessary "value center". Therefore, when competitors such as Solana achieved several times of growth in a short cycle, ETH still failed to effectively break through historical highs;

5) Geek community culture is separated from the mainstream of the market: Ethereum's geek-oriented community has long embraced technological purism, making it separate from the current mainstream players in the market. Refusing to embrace seemingly "low-level" innovative forms such as "Meme culture" have led to a cognitive generation gap between them and the new generation of user groups. In contrast, the Solana ecosystem has successfully attracted a lot of fresh blood and market attention with its inclusive and diverse and innovative attitude, forming a positive circular development effect.

That's all.

But just like many friends who love Ethereum deeply, even if they can see the various problems that Ethereum has, they still feel that Ethereum’s current dilemma is not irreversible. It is undeniable that its ecologically active developer ecosystem and the accumulated DeFi infra security consensus are still the most powerful.

When the market theme of technical narrative + long-termism is set, the Great Ether will still occupy the core seat. For most Ethereum enthusiasts and Hoder, giving up the excessive expectation of "the second in the encryption universe" and looking at ETH from the perspective of a purely decentralized network asset target may make a more correct choice.