Ethereum’s crumbling metrics and fractured community as Solana tightens the noose

Solana now processes a median of 60 million day by day transactions in comparison with Ethereum’s 1 million, proving that scalability issues greater than popularity in immediately’s blockchain wars. Is Ethereum lifeless?

Ethereum’s combat for relevance

From being celebrated as a pioneer in good contracts to now dealing with relentless competitors and inside discord, Ethereum’s (ETH) journey has began to look much less like a gentle climb and extra like a rocky descent.

To grasp Ethereum’s predicament, let’s rewind to November 2021, when its whole worth locked hit an all-time excessive of $107 billion, using a wave of optimism as ETH’s worth surged to a lifetime excessive of $4,890.

Quick ahead to the tip of 2023, and that quantity had dwindled to simply $30 billion — a staggering decline. Though 2024 provided a glimmer of restoration, with TVL climbing to $66 billion by mid-year, as of January 2025, Ethereum stays caught at $64.5 billion.

In the meantime, its closest competitor, Solana (SOL), has scripted a much more compelling comeback story. After plunging from a TVL of $10 billion in late 2021 to a mere $210 million in early 2023, Solana roared again to life, hitting an all-time excessive of over $12 billion this month — outpacing Ethereum’s restoration in each pace and scale.

Past TVL, Ethereum seems to be shedding floor on crucial metrics like transaction quantity and person charges. Whereas Ethereum processes a median of 1-1.2 million day by day transactions as of early 2025, Solana dwarfs this with a jaw-dropping 60-65 million transactions per day.

Solana day by day transaction rely chart (2025) | Supply: DeFi Llama

Ethereum day by day transaction rely chart (2025) | Supply: DeFi Llama

And regardless of Ethereum charging increased charges per transaction, Solana’s day by day price quantity is constantly increased, averaging $5-6 million this month and peaking at $35 million through the buzz surrounding the inauguration of Donald Trump because the forty seventh U.S. president. Compared, Ethereum’s price quantity hovered round $3-4 million on common, with a modest spike to $15 million on the day Trump was inaugurated.

Solana day by day charges chart (2025) | Supply: DeFi Llama

Ethereum day by day charges chart (2025) | Supply: DeFi Llama

Let’s dive deeper into the considerations surrounding Ethereum and the way this once-blockchain pioneer is having a run for its life.

The Ethereum Basis’s id disaster

Ethereum’s struggles will not be restricted to technological hurdles. The Ethereum Basis (EF), a nonprofit group lengthy considered because the spine of Ethereum’s improvement, is itself in a state of upheaval.

Inside discontent, rising competitors, and questions in regards to the basis’s imaginative and prescient have left the EF grappling with its id at a time when Ethereum’s future has by no means been extra precarious.

The strain has led Ethereum’s co-founder, Vitalik Buterin, to step in with sweeping plans to overtake the EF’s management construction.

For over a yr, Buterin has been quietly engaged on a restructuring initiative aimed toward addressing inefficiencies and enhancing communication between the EF and Ethereum’s builders.

“We’re within the course of of huge modifications to EF management construction,” Buterin revealed in a current X submit, including that the last word purpose is to determine a “correct board” to information the inspiration.

But, this effort has not been with out controversy. Critics argue that Buterin’s central function within the course of undermines Ethereum’s ethos of decentralization. Others see it as a obligatory intervention to salvage the EF’s declining popularity.

One of many EF’s most polarizing methods is its reliance on a “rollup-centric” roadmap, which prioritizes scaling Ethereum by means of layer-2 options.

Whereas these rollups have improved transaction speeds and lowered prices, they’ve additionally launched new dangers, reminiscent of diminished safety ensures and declining base price revenues for Ethereum’s core community.

Critics argue that these trade-offs spotlight the EF’s incapacity to ship a long-term scaling resolution that rivals like Solana have already achieved.

Solana’s potential to deal with thousands and thousands of transactions per day with near-zero charges has turn out to be a evident benchmark, leaving Ethereum struggling to maintain tempo.

Including to the turbulence is the controversy surrounding Aya Miyaguchi, the EF’s government director since 2018. Accusations of inefficiency and conflict-of-interest scandals have dogged her management, resulting in a wave of on-line criticism and even a social media marketing campaign calling for her resignation.

Whereas Miyaguchi stays in her function, the backlash has grown poisonous, with some critics resorting to private assaults and threats.

Buterin, visibly annoyed, took to X to sentence these actions as “pure evil,” warning that they’re driving high builders away from Ethereum.

“A few of Ethereum’s greatest devs have been messaging me just lately, expressing their disgust with the poisonous social media surroundings,” Vitalik tweeted just lately, pushing again towards requires management modifications on the EF.

He sharply critiqued, “YOU ARE MAKING MY JOB HARDER,” slamming the social media trollers and disgruntled customers, as frustrations over stalled improvements and a hostile on-line group take middle stage.

The Second Basis: A competing imaginative and prescient for Ethereum’s future?

In December 2024, Konstantin Lomashuk, the founding father of Lido — a protocol managing over 28% of Ethereum’s staked ETH — dropped a touch on X about plans to reshape Ethereum’s ecosystem.

The thought, which he referred to as the “Second Basis,” was initially teased as a method to introduce competitors to Ethereum’s management and decision-making processes.

On Jan. 22, Lomashuk doubled down on this imaginative and prescient, sharing an official web page for the Second Basis on X, signalling that this wasn’t simply an concept.

The Second Basis is designed to decentralize energy inside Ethereum by making a parallel entity that challenges the Ethereum Basis. Lomashuk has been crucial of the EF’s insular construction, describing it as “tremendous deep” and inaccessible to outsiders with out years of analysis experience.

“With out competitors, we danger shedding the precise path,” he wrote in a December submit. The Second Basis, he believes, will carry contemporary views and quicker innovation to Ethereum.

One of many foundational rules of the Second Basis is to protect Ethereum’s decentralization and censorship resistance whereas introducing extra sturdy governance mechanisms.

Lomashuk has highlighted plans to implement twin governance inside Lido, beginning in Q1 2025, for example of the type of innovation the Second Basis would champion.

The Second Basis’s imaginative and prescient additionally contains addressing Ethereum’s staking mechanism, a crucial part of its proof-of-stake safety mannequin.

Lomashuk has proposed that Ethereum intention for a minimum of 66% of its whole provide to be staked, arguing that this threshold is significant to stop validators from being concentrated in centralized custodians.

“If there must be a restrict, it ought to come from the Ethereum protocol itself and apply uniformly to all liquid staking protocols,” he stated in response to ongoing debates about Lido’s staking dominance.

Distinguished figures take intention at Ethereum’s path ahead

Whereas the EF works to reform its management and scale its ecosystem, critics argue that the platform lacks urgency, imaginative and prescient, and a coherent technique to keep up its dominance.

Two key figures within the crypto world — Kyle Samani, Managing Associate at Multicoin Capital, and Justin Solar, founding father of Tron — have taken to social media to focus on Ethereum’s shortcomings and recommend daring, if polarizing, methods for its revival.

Because the founding father of Multicoin Capital, an funding agency deeply targeted on blockchain, Samani credit Ethereum for igniting his ardour for crypto. “ETH was my first significant supply of wealth,” he tweeted.

Regardless of its early promise, his optimism has soured. The breaking level, he revealed, was Devcon 3, Ethereum’s annual developer convention held in November 2017.

Regardless of apparent scaling challenges — skyrocketing fuel charges and growing community congestion — Samani was surprised that scaling wasn’t even a spotlight of Buterin’s keynote.

“How will you not acknowledge what’s occurring round you and set forth a reputable plan with concrete and aggressive timelines?” he wrote. That second, Samani defined, was when he “misplaced religion in Ethereum.”

Seven years later, Samani believes little has modified. He factors to what he calls Ethereum’s “whole lack of urgency” and its failure to align management with the wants of its core constituents. And not using a clear “North Star,” as he places it, Ethereum dangers being overtaken by opponents that prioritize pace, scalability, and person expertise.

In the meantime, Solar, identified for his provocative model, went a step additional by providing a radical five-point plan for Ethereum’s revival, claiming his management might push ETH to $10,000.

The plan contains halting all ETH gross sales for 3 years, taxing Layer-2 options to generate $5 billion yearly, and drastically downsizing the EF workers to create a merit-based, high-performance group.

Solar’s plan additionally emphasizes growing price burns and lowering node rewards to strengthen Ethereum’s deflationary tokenomics whereas abandoning layer-2 rollups to focus solely on layer-1 scalability.

Whereas Solar’s concepts could appear radical, they faucet into real frustrations about Ethereum’s inefficiencies. The EF has lengthy been criticized for its gradual decision-making and perceived detachment from group considerations.

But, the feasibility of Solar’s imaginative and prescient is questionable. Taxing layer-2 options dangers undermining Ethereum’s rollup-centric roadmap, a key scaling technique, whereas downsizing the EF might strip it of the sources wanted to keep up its innovation pipeline.

Group and builders flip their again on Ethereum

Ethereum’s challenges are not confined to management controversies or competitor assaults — its very group is fracturing.

Beanie, a widely known crypto enterprise capitalist, just lately critiqued, “Ethereum Basis is run by a highschool instructor from Japan that hates competitors, believes in equality of consequence over alternative, and doesn’t acknowledge blockchain consensus as a way of governance.”

His critique of EF’s management tradition as “woke” and overly ideological has resonated with those that really feel the inspiration is prioritizing philosophical beliefs over sensible innovation.

The requires management reforms have additionally reached a boiling level. “If Aya Miyaguchi doesn’t step down, I’ll re-evaluate my funding thesis on $ETH,” declared Hedgex, a crypto investor, whereas publicly eradicating the “.eth” from his username — reflecting a rising disillusionment inside the group.

His sentiment was echoed by Eric Conner, a former Ethereum maximalist, who lamented, “I’m not a dot eth. Maybe sometime these in management roles will realign with the group, however for now, I’m out.”

The seeds of discontent had been planted effectively earlier than 2025. In October 2023, Mike Alfred, a worth investor, stated, “Ethereum seems to be sick. The world pc and ultrasound cash narratives have failed. DeFi and NFTs have largely been deserted. Vitalik and different insiders are looting the protocol.

The sentiment has solely worsened over time, with John E. Deaton, a crypto lawyer and longtime observer of the area, stating, “I’ve by no means witnessed ETH sentiment so low. Submit after submit exhibits individuals who was ETH’s greatest supporters shifting on.”

At a time when belief and unity are crucial, the Ethereum management should act decisively. Whether or not by means of reforms, higher communication, or a stronger deal with its decentralized rules, the community must bridge the widening hole between its beliefs and the group’s expectations.

If it fails to adapt, Ethereum dangers ceding its management place to opponents higher geared up to fulfill the second.