An in-depth report published on Medium showed that ethereum handled the equivalent of nearly $ 12 trillion in transactions in 2021. Visa transacted approximately $ 10.4 trillion. And so, the cryptocurrency with the second largest market cap outperformed VISA, one of the world’s leaders in digital payments.
However, 2021 was not an easy year for ethereum. The platform faced numerous challenges. In addition to scalability issues, the arrival of rival smart contract platforms has threatened ethereum’s dominance. But ethereum was able to crush them all. In particular, the network was able to stay on top thanks to its innovative protocols.
Ethereum underwent a technical update in August 2021 (London hard fork EIP-1559). The upgrade resulted in 4500 ETH being burned within 24 hours at 2 ETH per minute and this helped reduce gas taxes. Alongside this update, ethereum has also implemented Layer 2 scaling solutions. All of this has increased ethereum’s transaction capacity.
In 2021, ethereum’s L1 was able to process over 1.2 million transactions per day. This equates to 15 transactions per second. When Layer 2 became available, it grew even more. The developments are one of the main reasons that led ethereum to earn such high transaction volume.
Another significant cause of the massive boom in ethereum is the creator economy going mainstream. The creator economy on ethereum flourished with the expansion of NFTs. This has propelled ethereum to become one of the largest platforms for creators globally.