JPMorgan: Solana Will Take A Huge Market Share From NFTS Soon
Ethereum has been the most popular blockchain for smart contracts. In recent years, the cryptocurrency has proven to be a reliable platform for developers who are looking to build decentralized applications. However, JPMorgan analysts predict that Ethereum will lose market share from NFT and rivals such as Solana (SOL).
A memo shared with the bank’s customers, which Business Insider was given access to, stated that Ethereum’s share of NFT’s trading volume has decreased from 95 per cent in early 2021 to 80 per cent today, based on analysts’ estimates. This is a result of the high transaction fees that are charged on this particular platform.
According to the analysts, as with decentralised applications, “congestion and high gas charges” are causing NFT application developers to switch to other blockchains. Furthermore, the bank’s experts pointed out that Solana was the primary beneficiary of this trend.
Ethereum token ether could face a bigger problem in 2022 if the NFT loses more market share. However, the Ethereum 2.0 reform that is set to take place this year will help.
Over the last year, the market for NFTs has grown to $12 billion. Several million-dollar token collections have been sold.
However, in some parts of 2021, the average transaction fee on the Ethereum blockchain exceeded $80, forcing smaller traders to abandon the network. Solana, for example, was designed for scalability and can handle more transactions per second than other blockchains.
According to JPMorgan analysts, other chains such as WAX and Tezos gain market share. However, it is worth noting that investment bank analysts concluded at the end of last year that ether has more growth potential than bitcoin.
Alkesh Shah, a digital asset strategist at Bank of America, believes that Solana’s scalability, low transaction fees, and ease of use will make it an attractive investment for the cryptocurrency market in the future.
The year 2021 will almost certainly be pivotal in Ethereum’s evolution. After scalability improvements, the platform can outperform bitcoin in terms of market capitalization. If the Ethereum 2.0 reform is not fully implemented, Vitalik Buterin’s project could face significant difficulties.