This gave project developers the chance to leverage its distributed ledger network and formed the basis for decentralized finance, or DeFi.

As the first DeFi chain, Ethereum enjoys unrivaled popularity and dominance in the DeFi industry – contributing nearly two-thirds of the value locked in the DeFi ecosystem.

Ethereum contributed $171.1 million of $269 billion in the 87 DeFi chains. This dominance has led many to believe Ethereum can only continue growing, but JPMorgan (NYSE 🙂 fears it may lose its dominance.

Ethereum could lose its DeFi dominance
According to analysts at JPMorgan, Ethereum’s dominance could wane even further as competitors push deeper into decentralized finance. Ethereum once held 97% market share in the DeFi sector.

In addition, Ethereum’s late launch of sharding – an essential feature for Ethereum’s improved scalability – could mean the pioneer of DeFi play catchup in an industry where projects are offering greater scalability.

Ethereum is capable of processing between 15 and 45 transactions per second. However, it can also reach 10,000 TPS or up to 50,000 transaction per seconds. The average block time of Ethereum lies between 10 – 20 seconds, whereas Terra has an average block time of 6 seconds.

With the sharding feature expected to bring Ethereum up to speed with these faster chains looking to launch in 2023, JP Morgan believes the network’s market share in DeFi could continue to drop.

To The Flipside

• While JP Morgan believes Ethereum’s DeFi dominance is at risk, it believes that EthereumContinue It outperforms the pioneer crypto .

Why you should care

DeFi’s industry is growing rapidly at a rapid pace. The biggest winners are chains that support growth protocols.

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