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Why Ethereum Developers Ignore JPMorgan Criticism of Sharing and Scalability – Ethereum – US Dollar ($ETH)

Ethereum (CRYPTO:ETH) Developers ignored a warning from JPMorgan analysts that network scaling could come too late to ward off competition from rival projects.

What happened: Ethereum Developer Tim Beiko called JPMorgan’s memo on efforts to share second-largest coin ‘lazy/very high-level criticism,’ according to decryption report.

Pointing to a mechanism in place that allows transactions to be executed off-chain, Beiko said, “Rollups are live today, and sharding will reduce their costs, but the technology works and is now massively derisked.”

Co-founder of The Graph (GRT) Tegan Kline stated that Ethereum was the most used chain on the Ethereum indexing protocol.

“Of the 26 networks supported by The Graph, 66.7% of requests are on Ethereum,” Kline said.

Kline emphasized that on-chain security is important and said that “for the foreseeable future, Ethereum has the most security,” Decrypt reported.

See also: How to buy Ethereum (ETH)

Why is this important: This week, JPMorgan analyst Nikolaos Panigirtzoglou wrote that unless the “most critical” phase of Ethereum’s efforts to scale is completed in 2023, the network’s 70% DeFi market share could decline further.

“The optimistic view of Ethereum dominance is under threat. The scaling, which is necessary for the Ethereum network to maintain its dominance, may come too late,” Panigirtzoglou wrote.

The total value locked in DeFi was $230.8 billion, according to data from Defi Llama. Ethereum with a TVL of $144.9 billion led the segment.

Total value locked all channels – Courtesy of Defi Llama

Competitors such as Earth (MOON), avalanche (AVAX), and Solana (SOL) have a significantly lower TVL at 16.2 billion, 10.9 billion, and 10 billion, respectively.

The Graph’s Kline said DeFi projects on other blockchains are “driven by token incentives,” but Ethereum could also be moving in that direction, according to Decrypt.

“Once Ethereum Layer 2 adopts these same incentives, we will likely see a lot more DeFi activity on Ethereum.”

Even so, Ethereum rivals have seen a significant increase in activity spurred by an increase in the popularity of non-fungible tokens, DeFi and smart contracts in 2021.

This, in turn, led to a spectacular year for these tokens. LUNA climbed 13061.4%, AVAX gained 2985.5%, while Solana surged 9155.4% in 2021. In comparison, ETH rose 281.06%.

Price Action: At press time, ETH was trading down 6.7% at $3,232.35 over 24 hours.

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