Ethereum faces challenges with scalability and pressure from competitors

• Ethereum still leads DeFi, NFTs and smart contracts
• Solana and Avalanche gain traction among developers
• High fees drive solutions like Proto-Danksharding

Ethereum remains one of the leading smart contract networks, with a strong presence in DeFi, NFTs, and DAOs. However, its dominance is being tested by scalability issues and the advancement of networks like Solana, Avalanche, and Aptos, which offer faster and more efficient solutions for blockchain transactions.

Ethereum's growing pains and the crypto landscape

#cryptonews #ethereum #crypto https://t.co/FY1XxPsusn

— Crypto Whispers (@crypto_whispers) July 5, 2025

Since moving to proof-of-stake, Ethereum has significantly reduced its energy consumption, but high gas fees and network congestion remain obstacles. Initiatives such as Proto-Danksharding and the integration of Layer 2 solutions — such as Arbitrum and Optimism — are important steps forward, but they are still in development.

Meanwhile, Solana stands out with its proof-of-history (PoH) protocol, processing around 60 million transactions daily, with minimal fees and near-instantaneous speeds. This performance has attracted a growing number of projects focused on DeFi, NFTs, and gaming, solidifying the network as an attractive option for developers.

Avalanche has also shown progress with its subnet system, allowing projects to customize blockchains according to their needs. Aptos, with its focus on accessible tools and agile performance, has quickly gained ground.

In addition to the technical challenges, the Ethereum Foundation has been criticized for its slowness in updating and changing priorities, which has caused friction between developers and users. Decentralization, although one of the pillars of the network, also hinders faster decision-making, unlike blockchains with more centralized management.

Still, Ethereum maintains the largest developer community of any blockchain network. Data shows that over 6.200 active developers are working on the evolution of the ecosystem, a crucial factor in sustaining its long-term relevance.

Amid technological challenges, the crypto market is also reacting to macroeconomic factors. With inflation on the rise, Bitcoin has been seen as a store of value, while stablecoins are gaining traction as a hedge. Possible interest rate cuts by the Fed could positively influence the market, favoring assets such as Bitcoin, Ethereum, and altcoins.