Bitcoin is still the most popular cryptocurrency project in the world. However, it is no secret that Ethereum is rapidly catching up to the pioneer cryptocurrency. Ethereum’s decentralized finance (DeFi) use cases have been a major driver in this space, as investors have flocked to the blockchain in search of higher returns on their crypto holdings. This has given rise to well-known Layer 2 solutions such as Polygon.
Sandeep Nailwal, co-founder and COO of Polygon, recently appeared to discuss the future of the leading smart contracts blockchain. Ethereum is the number two layer one blockchain, trailing only bitcoin. And, according to Nailwal, it is only a matter of time before the blockchain takes over as the dominant Layer 1 protocol. He attributes this to a variety of factors and differences between the two blockchains.
The DeFi Industry Is Exploding
The COO explains why Ethereum is poised to dethrone bitcoin as the leading layer 1 protocol. The expansion of the DeFi space, according to Nailwal, was a major driving force behind this takeover. This is due to the fact that Ethereum was used for the majority of decentralized finance activities, making it the “ultimate settlement layer.”
Because of its popularity, ETH has become even more valuable as a blockchain, putting it directly in position to overtake the top cryptocurrency. “ETH will outpace Bitcoin and become the global standard sooner or later,” the COO predicted. Polygon’s scalability solutions, according to Nailwal, will play a significant role in the blockchain’s long-term success.
More than just beating Bitcoin to the top spot, the co-founder stated that the blockchain may not exist in ten years. This is due to the limited use cases, and the COO believes that for bitcoin to survive in the future, it must provide more functions than just a means of exchange and investment.
Filtering Out the Noise with Ethereum
With the passage of time, a slew of new projects have emerged to compete with Ethereum for the DeFi attention it is receiving. These blockchains, dubbed “ETH killers,” have risen to take market share from the leading DeFi platform. Solana has been at the forefront of this competitive movement, and it has grown tremendously as it has competed with Ethereum.
Despite the growing popularity of other Layer 1 solutions, Polygon’s co-founder does not believe that any blockchain can replace Ethereum. Despite the rise of its competitors, the layer 1 solution has maintained a majority share of the market.
Ethereum will almost certainly maintain its market leadership for the foreseeable future. With the addition of proof of stake to the blockchain next year, ETH is poised to dominate both the DeFi and crypto space.