Ethereum’s relative dominance among layer-1 (L1) blockchain networks has declined, resulting in an “open race” to become the leading Web3 platform, according to Alex Svanevik, CEO of data service Nansen.

“If you’d asked me 3–4 years ago whether Ethereum would dominate crypto, I’d have said yes,” Svanevik said during a panel discussion at the LONGITUDE by Cointelegraph event. “But now, it’s clear that’s not what’s happening.”

Ethereum is still the most popular L1 network. According to data from DefiLlama, its roughly $52 billion in total value locked (TVL) represents 51% of cryptocurrency residing on blockchain networks.

However, Ethereum’s dominance has diminished sharply since 2021, when the L1 controlled as much as 96% of aggregate TVL, the data shows. 

Panelists at the LONGITUDE by Cointelegraph event in Dubai. Source: Cointelegraph

“It’s an open race between multiple L1s for becoming the go-to platform for trading and broader blockchain use,” Svanevik said.

“We’re seeing smaller chains grow extremely fast, and a group of five or six chains emerging as leaders. It’s an exciting time,” he said.

Cointelegraph’s LONGITUDE is an event series that brings together leaders and innovators from the blockchain and Web3 space for exclusive discussions.

TVL distribution among blockchain networks. Source: DeFiLlama

Rise of Solana

Solana (SOL), an alternative layer-1 known for faster transactions and lower fees than Ethereum, is in pole position to become Web3’s next leading chain, according to the Nansen CEO.

“Solana has overtaken Ethereum on most onchain metrics — active addresses, transaction volume, even gas fees,” Svanevik said. “Ethereum still leads in TVL, and stablecoin issuance is still strong, but Solana’s growth is undeniable.”

Meanwhile, dozens of smaller L1s are also vying for market share — and not all of them are gaining sustainable traction, Vardan Khachatryan, chief legal officer of trading platform Fastex, told Cointelegraph during the panel. 

“Unfortunately, what we see in reality is that chains become popular when they are the hype of that particular bull run, new coins, airdrops, etc., rather than sustained adoption,” Khachatryan said.

Magazine: ZK-proofs are bringing smart contracts to Bitcoin — BitcoinOS and Starknet