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Ethereum, the second largest cryptocurrency by market capitalization, is facing serious obstacles on the market despite its strong fundamental growth. This is a worrying sign, especially considering the current state of the market.
One of the problems for Ethereum is that even though the growth of network activity, the burn rate and other factors have usually led to an immediate response in the price on the market, the tendency has changed in recent times. This may indicate that there is not enough funding on the market to support the growth of Ethereum.
While Ethereum has been growing in terms of network activity, with new developments such as the launch of Ethereum 2.0 and the increasing adoption of decentralized finance (DeFi) applications, the price of Ethereum has been stagnant. This is a problem for Ethereum holders and investors, as the network is not seeing the price appreciation that is expected to accompany such growth.
At press time, Ethereum is trading at $1,700, down from its all-time high of around $4,300 in May 2021. This is a considerable drop, and it suggests that there is a lack of investor interest in Ethereum despite its strong fundamental growth.
Another obstacle that Ethereum is facing is the issue of high gas fees. This has been a persistent problem for Ethereum users, particularly in the DeFi space. With high gas fees, it becomes more expensive to transact on the Ethereum network, which can be a deterrent for users and limit the growth of the network, despite the most recent steps developers have taken to increase the network's scalability.
Vladislav Sopov