Cryptocurrency fund Cyber Capital founder Justin Bons believes that with Uniswap’s shift to Layer 2 (L2), Ethereum’s transaction fee revenue will decrease, resulting in a reduction in the burning of Ether and making its deflationary narrative no longer valid. He suggests that Uniswap should become an independent L1.
After the announcement of the launch of the Layer 2 network “Unichain” designed for DeFi, Uniswap sparked a heated discussion in the community about whether Dapps issuing their own blockchain will become an inevitable trend and what potential impact it will have on Ethereum and UNI.
Yesterday (15th), Justin Bons, the founder and CIO of Cyber Capital, also commented on this, stating that this move will put Ethereum in trouble and suggests that UNI should move away from Ethereum as soon as possible. This remark quickly drew widespread attention from the community.
Justin Bons stated that one of the reasons why Ethereum is in trouble is that once Unichain is launched, the transaction fee revenue on Ethereum will decrease, leading to a decrease in the burning of Ether. This will eliminate the narrative of Ether as a “deflationary” currency.
Citing data from Ultra Sound Money, Justin Bons pointed out that since Proto-danksharding (EIP-4844) was successfully implemented in April this year, the supply of Ether has been gradually increasing, and the degree of deflation has been narrowing. He said:
Justin Bons criticized Ethereum’s high fees as stifling usability and innovation, suggesting that UNI should distance itself from ETH as much as possible. Furthermore, Justin Bons believes that ETH has deviated from its original vision. He said:
To make matters worse, other blockchains such as NEAR and EGLD have successfully implemented sharding technology. At the same time, fully parallel blockchains have effectively demonstrated that they can meet enormous demands without implementing sharding. He stated that technological advancements have achieved a balance between decentralization, security, and scalability, making all compromises in ETH’s “L2 scaling” strategy completely unnecessary.
However, ETH’s core developers still insist that it is “impossible” to scale L1 while maintaining decentralization, which Justin Bons finds hard to accept.
Justin Bons concludes that Ethereum is not only in a moral and ethical dilemma but will also face economic decline. While it still relies on past success to sustain itself, it is gradually losing market share, especially in the face of technically superior competitors. The success of UNI no longer depends on ETH. He said:
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