Grayscale Compares Ethereum to New York City

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Grayscale believes the Ethereum network shares a similar behavior with New York City, adding that it has rich features but is worst in certain areas. On Thursday, the digital asset manager published a report discussing smart contracts of various networks and how they compare to themselves. 

The report detailed Ethereum’s comparison to emerging blockchains, such as Solana, Cardano, and Avalanche. It then likened the ETH network to the vast, costly, and congested city of New York. The news follows the announcement of the launch of a cryptocurrency fund aimed at supporting newer blockchains. 

Grayscale Describes Ethereum and Other Blockchains

During its analysis of consensus networks, the asset manager firm compared the OG chain Ethereum to New York City, saying they share many similarities due to how they are perceived. Like NYC, Grayscale said Ethereum is vast and jam-packed simultaneously. 

“It is the richest network, with more than 500 applications under its belt that command roughly a hundred billion dollars. The value is over 10x more than a deployable network in the decentralized sector.”

The report said Ethereum would remain pivotal in the DeFi sector because of its large community and users’ beliefs in the network as a center for deploying innovative applications. The report also linked the amount of locked capital to the network’s popularity.

“A layer2 scalable solution, such as Polygon can be compared to a tall building in the city. It’s able to scale by going upwards,” Grayscale said. 

Newer Blockchains Are Similar to Low-Cost Cities

Grayscale made another detailed comparison of emerging blockchains, likening them to cheaper cities. It said users moving from Ethereum to another blockchain is like relocating to a low-cost city due to high fees and congestion caused by extreme demand. 

The report said the daily transaction volume increased strongly on emerging networks after ETH gas fees surpassed $10. These platforms charge way lower than Ethereum, hence, the port from the PoW-run network. 

Grayscale compared the structure of Solan to Los Angeles, adding that it is speedier and can be deployed for a vast range of use cases. It said Solana’s various consensus algorithms focus on speed and lower fees at the expense of centralization. The blockchain scales through an L1 chain instead of L2 chains, and that’s why it could process over 2000 transactions in a second.

The comparison ended with Avalanche. The report compared the network to Chicago in that it shares a similar economy with NYC but with a smaller network. Like Chicago, Avalanche is less congested, with cheaper transactions and centralized development. 

Grayscale expresses bullishness for blockchains, especially with the metaverse near. The market opportunities for DeFi are vast and at the center of it are blockchains, on which decentralized applications would be built on. 


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