The price of Ether (ETH) has been in a downward screw ever since Ethereum co-founder Vitalik Buterin presented at StartmeupHK Festival 2022. In a fireside conversation session on May 27, Vitalik stated that several internal team conflicts caused the proof-of-stake migration to delay its launch.

As reported by Cointelegraph, "Phase One," which introduces scalability through sharding, has been postponed to 2022. Furthermore, DeFi's inherently decentralized nature might not be entirely beneficial considering the sharding-style processing would need to run transactions through a relay chain.

Ether price in USD on Coinbase. Source: TradingView

Information technology's impossible to pinpoint the reason behind Ether'due south abrupt fall from its all-time high, but the surging gas fees certainly impacted investors' expectations. Non just did it make evident how limited the network was, but information technology also incentivized traders to experiment with alternative networks, like Binance Smart Chain (BSC) and Polygon's layer-ii solution.

Ethereum seven-day average gas fees in USD. Source: CoinMetrics

The nautical chart higher up shows that the $45 average gas fee took identify a whole month after the Berlin upgrade went live on Apr 15. The consensus in the Ethereum community was that Berlin was less impactful in the short term but paved the way for the awaited London difficult fork's EIP-1559 protocol on Aug. four.

This takes us to one of the three factors that could negatively impact Ether'south price in the short term.

London fork delay

The Ethereum London hard fork is part of the roadmap to the final Ethereum 2.0 release in 2022. The long-awaited update is scheduled for Aug. 4 merely has been delayed already, every bit the previous schedule mentioned tardily July.

Miners will be the almost afflicted by the EIP-1159 proposal, which aims to burn part of the fees generated on the Ethereum blockchain, hence reducing their revenue. Furthermore, EIP-3554 introduces an incremental difficulty adjustment that incentivizes the migration to the new proof-of-stake blockchain.

The delivery runway record of Ethereum developers too does not inspire conviction. If a partial upgrade were to take place and the more controversial changes were delayed, Ether's toll could slide, equally a portion of the current rally is built on the hype surrounding the hard fork.

Miner exodus

This time effectually, the main business organization isn't technical but social. Once it becomes clear for Ethereum miners that their revenue source will be gradually cut off, it is a matter of time until some competing network benefits.

Even though most smart contract blockchains have been designed for the proof of stake consensus model, some lesser-known projects could change their algorithm to support Ethash mining.

Analysts should not discard the possibility that Binance Concatenation or Solana could implement an additional security layer using the extra hashing power caused by an Ethereum miner exodus. Although this scenario is distant, these movements would undoubtedly put pressure on Ether's price.

Multichain DApps

The longer it takes for Eth2 to be fully implemented and for decentralized applications to upgrade their lawmaking to support parallel processing (sharding) capabilities, the higher the incentives for calculation multichain support.

Bend and Aave, the two leading DeFi protocols by total value locked, have both added support for blockchains other than Ethereum. Meanwhile, Polygon holds $550 one thousand thousand worth of Bend contracts and Aave holds some other $1.8 billion, according to data from DeFi Llama.

In the finish, the about likely "Ethereum killer" is the network itself because postponing the scaling solution would push users and DApps to alternative solutions. At the aforementioned time, the migration to PoS opens room to strengthen competing blockchains.

The views and opinions expressed hither are solely those of the author and do not necessarily reverberate the views of Cointelegraph. Every investment and trading move involves risk. Y'all should conduct your ain research when making a conclusion.