Market Performance Review of Infrastructure Blockchains, Jan to Apr 2021
From January to April of the first quarter of this year, or the market call-back in the mid-to-late April since the beginning of 2021, we defined this period of market performance as New Infrastructure Bull-run. We have witnessed that with new generation of public chains, the Layer 2 chain that serves the scaling plan of Ethereum, and the eco-chains of the head centralized exchange are leading the altcoin market out of a wave of the infrastructure blockchain sector. Relying on the advantages of several light-packed latecomers, the DeFi application on the new generation of public chains leads these infrastructures in the market capitalization ranking and construction of ecosystem projects to achieve a leap in technical and investment adoption.
From the above graph, at the respective price changes, or the direct return of each infrastructure’s investor, the comparison between each new generation public chain and Ethereum, it is shown that the biggest contender of the fastest-growing new generations: Solana is the first, and BNB is the second to achieve the highest ROI.
Since the market value of the above major public chains has risen from January to April this year, we can see a multi-chain universe in the future, and the market value share of Ethereum is gradually declining. Ethereum, as the mainstream smart contract platform, has been declining as the occupation of the market capitalization of the overall infrastructure network. In April, we saw the new ones that emerged in the volatile April. A generation of public chains, Binance Smart Chain with Binance as its backing, Solana ecosystem, Cardano ecosystem, and Polkadot ecosystem are constantly emerging.
We refer to the opinion of Kain Warwick. In Q1 we witnessed the social experiment and concept falsification of many new generations of public chains, which brought an impact on the Ethereum community and witnessed the early days of a multi-chain future.
Since the first half of this year, in the lineup of the new generation of infrastructure networks, for example, the Binance Smart Chain has evolved its own complete ecosystem, which can be regarded as the success of a conceptual social experiment. BSC verified that decentralization may be the needs and demands of developers, rather than the needs of general users. The most direct cost-effectiveness and the direct increase in the holding of tokens have attracted users and funds to flow into BSC in large quantities, just as the funds in the liquidity pool might do not have belief or loyalty but proceed with the most favorable return on their investment or farming.
The next-generation infrastructures such as Solana, Cardano, and Polkadot have already released smart contract functions and have been or have not yet been implemented, but many future sharding protocol projects have been completed and are ready to go. The new generation of infrastructure drives the eyes of users, developers, and investment institutions to gradually depart from the high degree of ties with Ethereum economically and ideologically.
The ecosystem construction of infrastructure network will not think that developers and users will come to this ecosystem just because it has achieved decentralization in concept and technology. As a traditional smart contract platform or the largest DeFi platform, Ethereum may be late in its expense rate and efficiency reforms, unless Ethereum makes progress in scaling in the middle of this year.
From the above chart, we can see that from January to April, the major scaling solutions with the best performance in the secondary market include: Polygon ($MATIC), Celer ($CELR) Liverpeer ($LPT), Avalanche ($AVAX), Skale ($SKL) ranks ahead, but in terms of overall market cap, compared with major smart contract platforms other than Ethereum (such as BSC, Solana, Avalanche), the market cap and market attention of the Layer-2 Scaling platform are still relatively underestimated.
The current limited scale of the Layer-2 scaling plan requires new participants to have a sufficient window of time to familiarize themselves with the development environment to gain more upward space on Ethereum. Otherwise, developers will inevitably look for elsewhere to build, which indirectly drives the blockchain world to a multi-chain development universe, in which we will discuss and conclude in the full report “Thesis of Infrastructure Blockchain, Blockchain Consensus, and Future of Scaling”: Blockchain Consensus Map, Market Performance Review of Public Chain and Challenge to the Infrastructure: Time Window of Scaling
Stay tuned!
