The total number of blockchain projects in the world is in the thousands. Many of them actively compete with each other for a share of the crypto market in their field, while some are just empty shells or mirror copies of others. But all of them are united by one thing – a serious drop in the price of crypto project tokens due to a bearish trend. Most likely, not all blockchains will survive the current difficult situation in the crypt. This opinion was voiced in a recent interview by Fantom Foundation CEO Michael Kong. Let’s talk about the details of what is happening in more detail.
Note that there are enough different networks in the world of cryptocurrencies today, and there really is competition between them. For example, in terms of trading volumes of NFT tokens, Ethereum is now the leader, while Solana is in second place. The rating of projects according to this indicator looks like this.
Blockchain ranking by NFT trading volume
In ninth place here is Avalanche. And although this network is not so popular for NFT tokens, it is actively used by game developers. Among recent examples of such new products, we can recall the game SHRAPNEL based on the Unreal Engine 5. Here is its trailer.
So modern blockchains are actively developing and in fact compete with each other.
What will happen to cryptocurrencies in the future
Fantom, the native token of the Fantom network with the ticker FTM from Kong, hit its all-time high at the end of October of the previous year, when the price of FTM rose to $3.46. At the same time, by today it has fallen by 93.6 percent.
Course FTM from the beginning of 2021
This is not necessarily a sign that the token itself is somehow bad – after all, a huge number of other coins show similar results in terms of profitability. At the same time, competition between them remains, in which Kong sees a positive for the market as a whole. Here is his point of view.
Competition is good because it gives us better results and better technology.
Соответственно, в нынешнем разнообразии популярных сетей есть плюс, поскольку разработчикам каждой из них нужно прикладывать усилия, чтобы выделиться на фоне других и привлекать пользователей.
That is, in the future, “a number of crypto projects definitely have a chance of survival.” The expert continues.
I think that in the future we will not have 20 or 30 different large blockchains. There will be only a few of them left, and I believe that they will get a large share of the market. People use several different blockchains. This is how it is today, and this is how it will be in the future.
Share of capitalization of the most popular cryptocurrencies
Recall that Fantom is a first-level blockchain, which is positioned as an alternative to the high cost and low speed of transactions in other blockchains, while Fantom is most often considered the main competitor of Ethereum. At the same time, on September 15, 2022, the Ethereum network completed its long-awaited transition from the energy-intensive Proof-of-Work (PoW) consensus algorithm to the greener Proof-of-Stake (PoS) algorithm.
Since then, the ETH price has fallen by about 32 percent. Kong believes that many in the altcoin fan community do not fully understand what the move from PoW to PoS means. Here is his remark, which leads Decrypt.
I think many people mistakenly expected that the Ethereum merger would greatly increase network bandwidth or make the project much more scalable. But representatives of the Ethereum Foundation have repeatedly stated that the goal of the merger is to basically get rid of PoW mining.
Действительно для увеличения пропускной способности Эфириума требуется внедрение так называемого шардинга. Он предполагает разделение общей сети на несколько отдельных цепочек — шардов, которые не будут зависеть друг от друга. На начальном этапе развития в блокчейне планируют внедрить 64 шарда, благодаря чему сеть будет в состоянии проводить в 64 раза больше транзакций в секунду.
Ethereum exchange rate since the beginning of September
In other words, the PoS transition event itself received too much hype. It was highly anticipated, and since traders didn’t see a noticeable increase in the price after the update, they started selling their ETH en masse. In addition, some before that bought Ethereum only in order to get altcoin fork coins, which so far do not show serious profitability, taking into account their exchange rate.
😈 БОЛЬШЕ ИНТЕРЕСНОГО МОЖНО НАЙТИ У НАС В ЯНДЕКС.ДЗЕНЕ!
With the transition of the Eth network to PoS, it may seem that Fantom and other popular PoS projects like Solana or Avalanche will lose their main advantage in competing with Ethereum in the form of cheap and fast transactions. However, Kong does not believe that this is the case.
We still have a competitive edge, at least for now, when it comes to our ability to process transactions asynchronously.
Отметим, что даже внедрение шардинга на первом этапе не позволит Эфириуму добраться до сегодняшних показателей той же Соланы, которая уже может проводить и проводит тысячи транзакций в секунду.
Most of all, the developer is worried about the alarming rhetoric of financial regulators.
I think that the main negative factor at the moment is the uncertainty in the field of regulation. This is what scares a lot of people in the industry.
SEC chief Gary Gensler
Recall that not so long ago, the US Securities and Exchange Commission announced a possible precedent in the course of a court case, which allows us to consider all transactions based on Ethereum belonging to the jurisdiction of the United States. The reason for this is the abundance of nodes in the country. In general, this is an alarming sign that regulators may try to “subdue” some areas of the crypto market.
Мы считаем, что разнообразие качественных блокчейнов в индустрии действительно необходимо. Благодаря этому пользователи могут выбирать более подходящие сети с учётом собственных потребностей — например, желания использовать проекты в нативном мобильном виде. Так что популярные сегодня блокчейны наверняка продолжат развиваться и захватывать долю на рынке. К тому же ближе к следующему буллрану в нише монет явно появятся новые перспективные проекты.
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