Is Ethereum Losing Ground to Layer 2 Solutions?

Ethereum's Capacity Challenges and Layer 2 Solutions

Ethereum, a leading blockchain network known for its smart contract capabilities, is currently facing significant capacity challenges. According to Justin Bons, founder of Cyber Capital, Ethereum is struggling to maintain its fee revenue primarily because it lacks the network capacity to support high transaction volumes. As a result, Layer 2 (L2) solutions are capitalizing on this limitation, thriving in the current environment by offering an alternative to Ethereum's main chain.