2024, the dark year of Ethereum? Unichain threatens to undermine ETH crypto

In recent months, Ethereum crypto has no longer been at the top of its form. And it looks like things are only getting worse for ETH. Uniswap's recent announcement to migrate to its own network, Unichain, could lead to a significant drop in activity on the Ethereum network. While some indicators point to a “bearish” trend for 2024, the launch of Unichain could well be the fatal blow for the second largest crypto on the market.

Unichain Unicorn Breaking an Ethereum Coin

Future of Ethereum threatened by Unichain launch

THE launch of Unichain – a crypto solution that could eclipse all Layers 2 – by Uniswap further weakens the Ethereum economy. Indeed, Uniswap, once the flagship of DeFi platforms on Ethereum, will now use a separate fee mechanism. Transactions on Unichain will allow Uniswap to recover considerable revenue via gas and MEV charges.

This means that these financial flows, previously reserved for Ethereum, will now be captured by Unichain, further weakening the ETH network.

L'Wajahat Mughal expert clearly said it about X: “ Unichain is just another proof of Ethereum’s “bearish” state in 2024 “.

If the largest DeFi application in terms of revenue leaves the ship to manage its own financial flows, this raises a major question: what future for Ethereum? How to buy Ethereum?

  • Less activity on layer 1;
  • Fewer GWEI transactions;
  • Drastic reduction in cash flow.
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ETH crypto faces major development challenges

With the rise of competing networks like UnichainEthereum is gradually losing its status as “Ultra Sound Money”. This concept, introduced after the implementation of the EIP-1559 proposal, was theoretically supposed to make ETH deflationary.

Gold, since April 2024, Ethereum supply increases againeven recording its longest inflationary period since the transition to the PoS consensus in September 2022.

Analysts are concerned that other protocols will follow Uniswap's lead and leave Ethereum Layer 1, plunging the network in a downward spiral.

For the ETH crypto to survive, it must not only rethink its economic model, but also offer new narratives capable of attracting investors and users in the face of these major changes.

However, a week ago, analyst Benjamen Cowen had already predicted a 50% correction for Ethereum crypto. The launch of Unichain only confirms this trend.

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