Bloomberg Report: Ethereum Losing Developers to Other Networks
Ethereum is losing developers to other blockchains according to various experts who spoke to Bloomberg in an article published earlier today.
Launched in 2015, the Ethereum network enables developers to hold initial coin offerings (ICOs), build decentralized apps (dApps), and create smart contracts. Its native coin, Ether, (ETH) is the second largest coin by market cap, and its most ardent supporters believe it will eventually unseat Bitcoin for the top spot.
However, per industry sources, the network’s market share is dwindling. Kyle Samani, co-founder of hedge fund Multicoin Capital Management in Austin, Texas, believes the reason has something to do with increased competition:
“The simple reality is that until the last six-to-nine months, there were no other options besides Ethereum. Now there are.”
Per the Bloomberg report, many developers are now switching over to platforms like Stellar and EOS, which some believe to be an “Ethereum killer.” In January, the Ethereum network accounted for just 28% of dApp users, while EOS claimed 48% and Tron accounted for 24%.
Travis Kling, founder of the Los Angeles-based crypto hedge fund Ikigai believes that holding Ether is simply a bet on the Ethereum network’s prospects:
“Owning Ethereum today is a call option on what you think the network is going to be in the future. To the extent that Ethereum competitor projects get traction with developers, with users, with dapps built on top of the platform, that will be viewed by the market as being detrimental to the overall value of Ethereum, and that can have a negative price impact on Ether.”
Ethereum may also be falling behind in another important category. The network’s block speed is about thirteen seconds, a figure that is falling behind other networks, which claim to be able to process transactions in less than a second.
However, as the Bloomberg report notes, most initial coin offerings are still conducted on Ethereum, and the network still has a strong core of developers.