In the comments at the end of these articles, many readers have expressed their disappointment with Ethereum's performance this cycle.
In fact, not only these readers, but I have also expressed my disappointment in the articles many times.
But despite the disappointment, we still need to analyze the reasons behind it rationally:
Is it a problem with Ethereum itself? Or is it a problem with the entire ecosystem?
If it is a problem with Ethereum itself, have these problems been solved in other blockchain projects?
Let me start with my conclusion:
I still hold my Ethereum position, not having changed it at all, and I haven't exchanged Ethereum for other smart contract blockchain tokens either; and I still remain bullish on Ethereum in the long run.
I remember that in my previous articles, I have mentioned more than once the three standards I use to evaluate a Layer 1 blockchain project:
How decentralized is its operation?
How is its community?
How is its team?
Today, my evaluation criteria remain unchanged.
Based on these three standards, the answer is quite simple.
Among all the Layer 1 blockchains that support Turing-complete smart contracts:
Ethereum has the best degree of decentralization in its operation, and Vitalik is still doing his utmost to further decentralize it.
Its community is still the strongest and most cohesive.
Its team is still unwavering in inheriting Satoshi Nakamoto's ideas, and is still steadily advancing the project, although the difficulty is increasing and the pace is slowing.
Ethereum is not perfect, and there are many problems (such as being criticized for the lack of transparency of the foundation, becoming more and more bureaucratic...). If you look closely, you might even find 100 or even 1,000 flaws. But I still have to say that looking at the entire crypto ecosystem, I really can't find a second smart contract public chain that surpasses Ethereum in these three aspects.
Some of the "problems" with Ethereum that have been criticized in many articles are not really Ethereum's problems in my view, such as the criticism that the Ethereum team does not focus on building applications.
The construction of applications should not be the focus of Ethereum's attention. The Ethereum team's focus should be on building the most decentralized, most neutral, and most censorship-resistant infrastructure, building a "good nest" where any phoenix (application) can come and thrive.
As for what phoenixes (applications) this "nest" can attract, let's leave that to the hackers and geeks with boundless creativity around the world.
Another example is the criticism that Ethereum's value capture has been taken away by Layer 2 scaling.
There is no need to worry about this at all.
Layer 2 scaling is still part of the Ethereum ecosystem, and its security will ultimately depend on Ethereum. This means that the value of the entire ecosystem will ultimately return to Ethereum. It's just that the value will first go to the Layer 2 scaling, and then spill over to Ethereum. This will only make the entire Ethereum ecosystem stronger and the barrier to entry higher.
Many readers have mentioned that Ethereum's token price performance is not as good as some other blockchains, and they feel those blockchains may have greater long-term potential than Ethereum.
I have never used short-term price performance to measure a project's long-term potential.
If we look back at Ethereum's growth trajectory, we can appreciate the hardship and tribulation it has gone through to be called the "king of smart contract public chains" today.
How many incidents, conflicts, and attacks has it experienced?
It has always been under the spotlight, and any of its problems cannot escape scrutiny.
Without this kind of ordeal of going through fire and brimstone, it would not have achieved its current position.
This kind of ordeal is not only a challenge to the project itself, but also a challenge to the project team, the project community, and especially the spiritual leader.
When we think about whether a project might overturn Ethereum's position, we might as well ask:
When that project sits on the "throne", will it be able to withstand the same tests that Ethereum has gone through? Will its team, community, and spiritual leader be able to endure the torment that Ethereum has faced?
The "throne" is not easy to sit on.
If I have to ask why Ethereum's price in this cycle has not performed as well as some other blockchain tokens?
I've thought about it seriously, and if we just look at the applications, apart from MEME tokens being very active on some other blockchains, I can't think of any other new applications.
But is MEME token really an innovative application? Even if it is, can it last?
If the rise in a project's token price is not due to a sustainable application innovation, I will see this price rise as a short-term market fluctuation rather than a fundamental factor in changing the project's long-term potential.
So I will ignore this kind of short-term price comparison.
In fact, what has impressed me the most in this cycle is the innovation of Bitcoin, especially the innovation of a group of protocols led by Ordinals. But unfortunately, after the protocol innovation in the Bitcoin ecosystem, the subsequent application innovation has almost gone out.
Looking at the entire crypto ecosystem, application innovation has been scarce in this cycle.
Going back to the questions I raised at the beginning of the article:
Is it a problem with Ethereum itself? Or is it a problem with the entire ecosystem?
My answer is: The fundamental reason for Ethereum's sluggish price performance this cycle is the lack of application innovation, but this problem is not only a problem in the Ethereum ecosystem, but also a problem facing the entire crypto ecosystem.
If it is a problem with Ethereum itself, have these problems been solved in other blockchain projects?
My answer is: This problem has not been solved in other blockchain ecosystems either.
Actually, when it comes to price performance comparisons, I've been thinking more about why Ethereum's price has been constantly declining relative to Bitcoin in this bear market - from about 15 Ethereum per Bitcoin in the last bull market to over 20 Ethereum per Bitcoin now.
I think the reason for this is probably still the lack of application innovation.
After the US government relaxed regulations on institutional investors in this cycle, institutional investors started eyeing this ecosystem hungrily.
But when they found the entire ecosystem lacking in applications and users, with almost no "application value" they could understand, how much could they invest?
They can't just have BlackRock buy MEME tokens, right? They're probably not even interested in DeFi tokens that don't have much value-added.
In this case, the only thing they can buy that is risk-controlled, liquid, and has a high consensus is basically just Bitcoin.
With this logic, it's easy to understand why Bitcoin's price has been so dominant over other tokens.
But I don't think this is the norm, because the crypto ecosystem can't always rely on Bitcoin. In the future, the crypto ecosystem needs to have real application innovation and new business models in order to truly change our lives. And I still believe that this innovation is most likely to happen in the Ethereum ecosystem.
