Layer 1 Blockchains Take Center Stage in the Crypto Bull Run: A Closer Look

Layer 1 (L1) blockchains have emerged as the focal point of the ongoing crypto bull run, with their collective market cap exceeding $2.8 trillion as of November 29. This milestone comes on the heels of renewed enthusiasm within the crypto space. Bitcoin, the dominant L1, accounts for nearly 70% of this market share, while Ethereum, Solana, Cardano, and other L1 platforms are also riding the bullish wave.

Market Performance: A Review

Bitcoin has set a new all-time high of $99,600 on November 22, while Ethereum has seen significant gains, up by over 34% and trading at $3,630. Solana reached an all-time high of $263.83 on November 23, marking a 40% monthly gain. Cardano has taken the market by surprise with an impressive 200% surge over the past month, now trading at $1.09.

Emerging platforms like Hedera and Mantra have also shown remarkable performance, posting gains of 220% and 138%, respectively. However, Binance Coin has lagged behind its peers, delivering only a modest 10% gain over the past 30 days.

Assessing Utility Beyond Speculation

To gauge the performance of L1 blockchains beyond mere price action, it’s essential to consider their total value locked (TVL). TVL serves as a barometer of trust and activity within a blockchain ecosystem. High TVL typically signals robust adoption of DeFi applications, while low TVL may indicate diminished usage or waning interest.

Ethereum remains the unchallenged leader in this space, boasting over $70 billion in TVL as of November 29 — an impressive 44% increase from $47.5 billion on November 5. Solana has also shown notable progress, with its TVL climbing over 50% to $9.17 billion.

The Fee Race: Who’s Winning?

Blockchain fees have long been a vital metric for assessing the activity, utility, and adoption of L1 platforms. They represent not only the cost users are willing to pay to transact but also the demand for block space and the overall health of the ecosystem.

Solana consistently outperformed Ethereum in daily fees throughout November, a gigantic milestone reflecting its growing adoption and increasing network activity. As of November 28, Solana recorded $7.4 million in daily fees, while Ethereum hovered around $6.19 million.

The Current State of the dApp Ecosystem

The dApp ecosystem serves as the ultimate proving ground for L1 platforms, showcasing their ability to drive activity and engage users. By analyzing transaction volumes and key contributors, we can uncover what fuels these networks and how they stack up.

Ethereum remains the heavyweight in DeFi, generating $175 billion in transaction volume across 4,844 dApps in the past month. BNB Chain has cemented its reputation as a retail-friendly ecosystem, processing $38.2 billion in volume from 5,555 dApps. Solana dominates in raw activity, boasting 113.66 million unique active wallets and 594.7 million transactions over the past month.

The Road Ahead

The current bull market has thrust L1 blockchains into the limelight, highlighting both their strengths and their vulnerabilities. As prices continue to climb and adoption broadens, the true test for L1s will be sustaining this momentum. Proving their utility beyond speculative cycles will be crucial in cementing their place in the crypto space.

Whether this bull run signals the dawn of a transformative era or simply another chapter in crypto’s unpredictable journey depends on how these platforms adapt to meet the demands of an ever-growing global audience. The stage is set, but the story remains unwritten.

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