Since the CryptoKitties debacle in 2017, we’ve been hearing promises that Ethereum would scale soon and that Vitalik Buterin and friends would pull a rabbit out of a hat to bring gas fees down for good.
Yet, over five years later, Ethereum is no further along. As an inherently flawed state machine, it can still only process 20 transactions per second (max) on the base layer, and fees fluctuate wildly depending on use.
We saw yet more evidence of this recently when a handful of meme coins created major congestion on Ethereum and almost tripled the average gas fee. While some Ethereum advocates celebrated the growth in revenue for stakers, others lamented the gas fee increase as $TROLL, $APED, and $BOBO entered the top 10 gas burners on the network.
⛽️ A highly unusual shift in top 10 gas burning #altcoins has emerged today. Instead of $ETH, $WETH, and $USDT being at the top of the fee distribution list, we’re seeing new assets like $TROLL, $APED, and $BOBO among them. Read our latest deep dive. ???? https://t.co/7SlmJ59k2m pic.twitter.com/Y2kaLKZTrL
— Santiment (@santimentfeed) April 19, 2023
It’s yet another demonstration that the Ethereum blockchain is wholly unsuitable as anything other than a novelty network for pet projects that don’t require serious scaling.
Utility is taking center stage, and Ethereum will not fare well
In July 2025, it will be Ethereum’s 10th anniversary, and with the way the digital currency and blockchain markets are changing, it’s not looking good for Vitalik Buterins’ brainchild. Already, many Ethereum developers have jumped ship, realizing the promises coming out of the Ethereum camp were nothing more than hollow words; time and again, update after update, those who staked their futures on Ethereum have been left disappointed.
With the speculative mania of recent years dying down and regulations coming down hard on exchanges, promising to drive out unregulated stablecoins and limit leverage, we’re seeing a shift of focus to utility, the real-world use cases of blockchain technology, and the problems it solves. In such an environment, hype machines like Ethereum will begin to fall behind as utility blockchains that can deliver the goods take center stage.
For example, take Bitcoin SV (BSV), the original protocol designed by Satoshi Nakamoto. It’s currently processing millions of transactions daily with fees of just $0.000007 (04.20.23), and real companies like STUK.co and Haste Arcade are harnessing the power of the BSV blockchain to manage data and deliver services that would otherwise be impossible. See Haste’s Instant Leaderboard Payout technology, which is used in its arcade, for one example.
Deliver or die – there’s no other way forward
Let’s cut to the chase and spell it out: the era of easy money, VCs throwing bags of cash at everything with the word blockchain in it, and rogue stablecoins like Tether pumping speculative tokens like BTC and ETH to insane heights is over. The big crash has already occurred, and just as with the Dot Com crash back in 2001, only the companies that use the blockchain to deliver real services in a way that’s better than what’s already out there will survive.
So, you tell me, how are companies going to deliver anything of value on a blockchain that is incapable of scaling on-chain, which has fees that almost triple when put under a little pressure by some silly memes coins? What serious business will be able to deliver blockchain services at an affordable cost when it can’t even predict what its costs will be weekly or month to month?
In the new era, where blockchain startups have to do something useful to earn their money, they’ll need utility blockchains that scale with fees that either remain low to build on. In this era, nobody will care whether you can run a node at home or whether Lord Vitalik says it’s cool or not. Businesses don’t deal in ideology; they deal in dollars and cents, and the most affordable solutions that work today will win.
Seriously, get your study cap on and hit the books. Try to find a blockchain that can lay a glove on Satoshi’s original Bitcoin; you won’t be able to. Then, let logic take its natural course and ask yourself; how will companies building on blockchains like Ethereum compete with those building on BSV? They won’t be able to, and that’s all anybody really needs to figure out.
“But Ethereum is going to scale!” I can hear some shrill voices yelling internally as they read this. Yeah, right. If it could have, it would have, and if a feasible layer-two solution emerges in a couple of years, it’s going to be too late. Businesses are signing deals now, and utility blockchains will have it all tied up before Vitalik Inc. delivers anything feasible.
We’re well into the blockchain marathon now, and in the era of utility, those who have been focused on scaling and building superior technology are going to rapidly catch up with and overtake those who have been focused on pie-in-the-sky layer-two networks and coin prices. In BSV’s case, it has already surpassed Ethereum many times over, and the gap is only going to widen.
While Ethereum has been in the limelight during the early days of the industry, unless it delivers solutions that can best its competitors in the next year or two, it’s not going to be relevant for much longer. After all, if a couple of meme coins can break the network, how is it ever going to underpin the global economy, as Ethereum maximalists claim?
Follow CoinGeek’s Crypto Crime Cartel series, which delves into the stream of groups—from BitMEX to Binance, Bitcoin.com, Blockstream, ShapeShift, Coinbase, Ripple,
Ethereum, FTX and Tether—who have co-opted the digital asset revolution and turned the industry into a minefield for naïve (and even experienced) players in the market.
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.
Read More
Gavin Lucas