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Zeng Jingjun, a contributor to Soul Wallet and a key member of the team, said that crypto is still in its early stages.
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Vitalik Buterin believes more money will flow into the crypto wallet if L2 solutions are affordable.
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Buterin stated that low transaction fees are necessary for crypto to mature.
Vitalik Buterin, co-founder of Ethereum, believes that decentralized finance will remain strong if transaction fees continue to drop. Buterin believes affordable Layer 2 (L2) solution are the key for widespread DeFi adoption. They will attract more capital and even traditional financial institutions.
Zeng Jiajun – a key contributor to Soul Wallet – sparked a larger discussion that led to this insight. Jiajun said that the crypto market was still in its infancy. He said that Bitcoin (BTC), which is the largest digital asset in the world by market capitalization, dominates the rest of the digital assets with a dominance over 50%. Its $1 trillion value dwarfs the total value of all altcoins despite the sheer volume of projects with enormous potential.
Jiajun acknowledged the fact that although half of Wall Street is Bitcoin owners, there is a huge potential for adoption of digital assets. He said that the Ethereum Merge, the launch of L2 products like Arbitrum, ZkVM, and ZkEVM and other significant milestones within the blockchain industry have only occurred in the last few years.
“BTC dominance > 50 % is the exact reason why we are early. “Crypto is more ‘blockchain than currency’.”
Affordable L2s to Drive growth
Jiajun noted that, while $20 billion was invested in digital assets in the last four years, this pales in comparison to the $200 billion invested in AI during the same time period.
Buterin responded by suggesting that the situation could change as affordable L2 solutions become available. The Ethereum cofounder said that he has been advocating that DeFi’s future potential, beyond high-value transactions, depends on low transaction fees since 2020.
Read Also: Ethereum Vitalik Buterin’s Vision for User Friendly Crypto Transactions Gains Momentum
Buterin said that the lower fees for many L2 solutions were only introduced in March, which could mean that more money is going to be invested into these networks over time as the market matures.
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