NFT Market: Ethereum Loses Space to Solana – JPMorgan

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In Brief
  • The dominance of the Ethereum (ETH) network in the NFT market is being threatened by Solana (SOL), according to a new report from JPMorgan Chase

  • Ethereum still has an 80% share of this market, but it had 95% at its peak

  • The bank also highlighted that Ethereum is losing prominence in the DeFi market

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NFT market: The dominance of the Ethereum (ETH) network in the non-fungible token (NFT) market is being threatened by Solana (SOL), according to a new report from JPMorgan Chase.

Analysts at the traditional investment bank noted that Solana has captured an increasing share of the NFT market.

Every day, more users and developers use their network to mint new non-fungible tokens (NFTs).

Ethereum losing space

According to a report, Ethereum was responsible for about 95% of the volume of creation and transactions involving NFTs at the beginning of 2021. Currently, the network holds 80% of this segment.

On the other hand, Solana had a great growth in its participations. Much of this expansion is due to the fact that its network is more sustainable, using a single method to validate its transactions.

It is worth noting that the environmental impact caused by the minting of new tokens has been one of the main criticisms that fans and communities have in relation to the adoption of NFTs. In this way, Solana manages to be more attractive to big names that want to explore alternatives in this segment.

Also, its blockchain offers cheaper fees to users. Ethereum, in times of high flow on its network, charges more than $50 per transaction. 

For JPMorgan, Ethereum’s loss of space in the NFT market is a cause for concern for network enthusiasts and investors, as this segment has seen the greatest growth within the crypto universe.

The bank also highlighted that the network has also lost its role in another niche, that of decentralized finance (DeFi). This is especially because Ethereum lags behind other competitors in terms of network scalability.

NFT market: SOL surpasses ETH in 2021

Despite ending 2021 with an appreciation of approximately 400%, Ethereum lagged behind Solana’s native token in this regard.

SOL was one of the biggest sensations of the crypto market in the year, reaching more than 20,000%. However, the token is down nearly 50% from its all-time high, while ETH is 35% below its all-time high.

NFT market

Furthermore, Solana still has a long way to go if it wants to surpass Ethereum in market cap, according to data from CoinGecko.

Ethereum is the second most valuable crypto project in the world, with a capitalization of $376 billion. Solana, which is in 7th position, has a market value of just over US$ 43 billion.

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Anderson serves as a writer for BeInCrypto, covering news about the cryptomarket and the economy in general. He has also participated in projects related to crypto trading, news production and educational content. With a degree in Administration, he is currently pursuing a postgraduate degree in Investments and Blockchain at the EA Banking School.

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