Ethereum Reign Falters as Layer-1 Race Heats Up in Web3 Arena

Ethereum, long considered the bedrock of decentralized applications and blockchain innovation, is no longer the undisputed king of Layer-1 networks. That’s the message from Alex Svanevik, CEO of blockchain analytics firm Nansen, who described the current state of Layer-1 competition as “an open race” during a recent industry panel at a recent event. Once commanding an overwhelming 96% share of total value locked (TVL) across all Layer-1 platforms in 2021, Ethereum now holds just over 51% of that market, according to data from DefiLlama. While still the leader in TVL—approximately $52 billion— Ethereum’s relative dominance has been under steady pressure from emerging chains offering speed, efficiency, and lower costs. “What’s happening now is unprecedented,” Svanevik said. “Just a few years ago, Ethereum’s dominance was unquestioned. Today, we see multiple chains gaining serious traction and proving viable alternatives.” Solana Outpaces Ethereum in On-Chain Activity One such contender is Solana, a blockchain platform optimized for fast and low-cost transactions. According to Svanevik, Solana has already surpassed Ethereum on several on-chain metrics including daily active addresses, transaction throughput, and even total gas fees. While Ethereum continues to lead in stablecoin issuance and institutional TVL, Solana’s growth trajectory has caught the attention of developers, users, and investors alike. “Solana is now in pole position,” Svanevik noted, emphasizing that the pace of innovation and adoption is what makes the current L1 landscape so dynamic. “We’re not just seeing one or two chains nibble at Ethereum’s heels—there’s a growing group of five or six serious players.” This fragmentation of dominance suggests that the Web3 future may not be monopolized by a single chain, but shaped by a diverse, competitive ecosystem where multiple Layer-1s serve different needs and user bases. Hype vs. Sustainability in the L1 Race However, not every rising Layer-1 chain is built to last. Vardan Khachatryan, chief legal officer at Fastex, pointed out that many new chains see inflated growth driven more by bull market hype and short-term incentives than by meaningful adoption. “Too often, popularity is a product of the moment—airdrop farming, speculative coins—rather than sustained use,” he said. As competition intensifies, the chains that endure will be those offering long-term value, not just trend-fueled spikes. Ethereum may no longer dominate unchallenged, but its role as a benchmark still stands—at least for now. The post Ethereum Reign Falters as Layer-1 Race Heats Up in Web3 Arena appeared first on TheCoinrise.com .