It was difficult September for crypto investors. This is especially true for those who were betting on the token tied with the Ethereum blockchain.

Ether droppedIt was down 13% in July, which is the second largest monthly decrease in the last year. June saw a decline of 16%. BitcoinSeptember saw a 7% drop in sales

Short-term movements in price can’t be linked to one event. With the crypto rally over the last 12 months, it’s not easy to predict pullbacks. Ethereum, second most valuable cryptocurrency, has seen a rise of around 83% in the past one year.

Investors now buy the September dip. Both bitcoin and ether rose more than 9% Friday.

However, the September roller-coaster highlights a particularly difficult stretch of the ethereum ecosystem. Investors and developers have reason to worry.

Both the slow speed and high fees for transactions continue to pose a problem. It was intended that the August “London” upgrade would bring about a significant improvement in network speed and transaction fees. make transaction fees less volatileIt has only had a small effect.

In the meantime Ethereum’s problems are being exploited by rival blockchains called “ethereum killers”.

Ethereum unexpectedly also split into two separate chainsLate August was the result of a vulnerability in software used to connect to blockchain. The attack on the network was not the first.

All these factors may have an impact on speculation, it is certain,” he said. Mati GreenspanInterview with Quantum Economics founder and CEO,. But don’t forget, ethereum is up quite a bit this year. The entire market appears to be consolidating at the moment. This is why I don’t think you should try to analyze these movements in the short term.

To fend off this new competition, there are major obstacles for ethereum. It serves as the main building block of all crypto projects like smart contracts, non-fungible tokens, and decentralized financing (DeFi).

“This fork temporarily created two separate records of transactions on the ethereum network – like parallel books,” said Matt HouganBitwise Asset Management’s chief investment officer, he created the first cryptocurrency-indexed fund.

It was not clear for a long time whether the split would result in a “doublespend attack”, where the same token may be used more than once, and transactions can be reversed. Hougan stated that this is possible. Potentially, smart contracts that manage billions of dollars worth assets may have been in danger. People can build apps on top of Ethereum with self-executing codes using smart contracts. This eliminates the need for third parties to manage transactions.

It would have been hard to carry out such an attack, as it was not clear which nodes were in the right side of the split. Hougan stated that there was an inherent risk.

Good news is for exchanges and miners: Most of them updated their software according to recommendations and the problem was quickly resolved, stated Tim Beiko (coordinator for ethereum protocol developers).

Auston BunsenQuikNode co-founder, who provides infrastructure for developers and businesses using blockchain, stated that it was a “responsibly revealed vulnerability.”

Hougan stated that this is an important reminder of the disruptive nature of blockchains and specifically ethereum. “They can do amazing things – settle $1 billion transactions in minutes and program money like software – but they are not fully mature.”

Geth can be abbreviated as Go Ethereum. Operators and miners can choose from a variety of software to access the Ethereum blockchain. Geth is the most popular. accounts for 64%network.

It was due to this that the ethereum Blockchain split in half just a few weeks back. Geth experienced a problem in its consensus mechanism. This is what makes transactions transparent and everyone can see the truth regardless of the software they use.

The bug was discovered by developers, who released a new version with the fix and advised everyone to upgrade. Some users did upgrade, others didn’t. Unknown actor exploited this bug. ethereum forked and broke apart into two chains. One for users who had upgraded their software, the other for people who hadn’t.

Coinmetrics co-founder Nic Carter said that Ethereum sought the facade of decentralization through having many clients. However, this has led to incompatibilities.

It can cause problems in the network if the software programs are not able to communicate with one another.

Bitcoin is a completely different way to do things. It relies on a highly secure software program for nodes to access the blockchain. Bitcoin developers are keen to avoid hardforks. All changes to the core software should be considered opt in, rather than being pushed to users. Carter.

Carter explained that Ethereum is more concerned with speed than software development. However, this comes at the price of less secure implementations.

Crypto experts often attribute the success of ethereum to its unique first-mover advantage. Many NFTs 78% of DeFi appsAccording to State of The Dapps’ website, the application dApps runs on ethereum.

Increasing popularity of other blockchains is changing this. 

Users were already complaining before the split of blockchain. They had complained about high transaction fees and heavy congestion. 

Solana processes 50,000 transactions per secondThe. average cost per transaction is $0.00025According to the website, it is. Ethereum can handle approximately 13 transactions per secondTransaction fees on Solana are significantly higher than Solana’s. 

The institutional money flows. Solana just closed a $314 million private token salePolychain Capital, and Andreessen Hoowitz were the chiefs.

Investors, who were primarily focused on Ethereum, “are increasingly diversifying their holdings and fueling other blockchains such as Algorand Solana, Cardano, and Solana,” stated a spokesperson. Mark PeikinBespoke Growth Partners’ CEO is.

Bunsen told CNBC that Solana has made good progress in becoming a useful blockchain but it is not yet sufficiently decentralized to meet the needs of the wider crypto community.

You can also catch bugs on it. Solana was infected with a virus last month. 17-hour outageFollowing a denial of service attack that saw a flood in transactions from bots.

Bunsen says that the list of so-called “ethereum killers” is extensive and contains blockchains such as Matic and Polygon which complement ethereum. Cardano is also known for being secure.

Bunsen stated, “I believe some of the ethereum-killers will make it.” But they won’t kill the ethereum.

Ethereum is also getting an upgrade. Since several years it has been developing ethereum 2. It is scheduled to be completed by the end of the first quarter in 2022.

It will be possible to make ethereum into a lower-energy mining process. according to network founder Vitalik ButerinThis could increase speed up to more than 7,000 times, or 100,000 transactions per second.

Bunsen claimed that ethereum 2.0 will bring a tremendous increase to throughput and overall environmental benefits if the project is successful.

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