After the introduction of Ethereum (ETH) to the crypto space, a lot of cryptocurrency enthusiasts have expressed their hopes that it would dethrone Bitcoin being the leading crypto asset by market capitalization.

On the other hand, many analysts suggest that it would be hard for ETH to reach that spot, especially that it is poised to struggle this 2020.

Currently, Ethereum collapsed by 89% from its all-time high $1,419.6 while the rate of Bitcoin is gradually plunging over 50% from its historic high. The said price drop suggests that the two cryptos exposed the investors to the infamous crypto-mania back in 2017. However, ETH is expected to experience further negative market performances.

Absence of Ethereum 2.0 ‘Til 2020

According to some reports, the Ethereum 2.0 will remain unavailable in the market until 2010. That’s because the Serenity rollout will require seven phases before completed.

Market Research Firm Messari said that Phase 1 is even not available until 2021, which will consist of 64 shard chains. The upgrade, as mentioned earlier, is considered to be the key to scaling. As for Phase 2, the full launch will include a huge dApp migration and an eWASM virtual machine.

If you missed the news, Ethereum 2.0 is a new blockchain that will deliver a high-risk transition. Then, it is expected to offer a more stable financial system.

The Impact of Initial Coin Offering

It was 2017 when cryptocurrency became a hype, where scammers created their versions of the tokens and then sold through an initial coin offering (ICO) to unaccredited investors.

Unfortunately, ICOs large portion utilized ETH as the blockchain. So, the crypto turned de-factory currency, as well as a number of companies, pulled massive capitals that were derived in BTC in exchange for the assets. It’s no surprise why the rates of ETH and BTC surged exponentially.

According to crypto analysts, the pump of rates resulted in ETH to be overbought. Following the sliding value of Ethereum, a lot of ICO projects opt to sell their ETH holdings to secure a more stable money. However, it only resulted to more than 90% unsuccessful startups while others fail to generate revenues.

Since then, Bitcoin moved ahead and became a safe-haven asset. Then, because of the temporary bullishness alone helped BTC to recover, unlike ETH.

Competition in the Blockchain Space

Ethereum is still on the position where it struggles to emerge in the blockchain market. Binance Chain, EOS, and Tron are some of the blockchain projects that stop the ETH in enjoying market dominance. Though these projects have no negative effect to the narrative of BTC, their growth tends to have a threat to Ethereum.

On the bright side, Ethereum got an advantage due to Decentralized Finance (DeFi). The protocols that allow a peer-to-peer lending with the help of ETH hold $687 million reserves and will grow up to $293 million this January. Thus, analysts expect that DeFi can be the next ICO mania for the second-largest crypto asset by market valuation in 2020.