ETC Group advises holding Ethereum, Solana, and Aptos through market shifts

ETC Group advised investors to hold Ethereum (ETH), Solana (SOL), and Aptos (APT) due to their strategic importance in the layer-1 blockchain space in an Oct. 8 report.

As Ethereum faces mounting competition from newer blockchains, the report highlighted the importance of evaluating the market’s recent conditions and long-term performance.

Ethereum faces challenges

According to the report, Ethereum’s underperformance in the third quarter was driven by three main factors, the main one being the Dencun update, which significantly lowered gas fees to boost the effectiveness of layer-2 networks.

This led to a fall in transaction fees and network activity on the Ethereum mainnet, which has negatively impacted user sentiment about the network.

Additionally, the market crash in early August caused by the unwinding of the Japanese Yen carry trade resulted in deleveraging across the market, with ETH being one of the most affected.

The report noted that the lackluster performance of spot Ethereum ETFs has also contributed to the quarter’s subpar performance, which is the weak spot exchange-traded funds (ETF) flows. Since their launch, spot Ethereum ETFs registered negative net flows of $546 million, based on Farside Investors data.

Despite these setbacks, ETC Group’s analysis suggested that Ethereum looks resilient when viewed year-to-date, maintaining a performance index of 101 compared to Solana’s 128 and Aptos’ 78.

The report calculated network dominance using the Comprehensive Network Dominance Index (CNDI), which combines metrics such as Network Utilization Efficiency (NUE) and Economic Density Index (EDI).

Based on its findings, Ethereum remains the most dominant network, with a 45% market share, followed by Solana with 35% and Aptos with 20%. The report attributed Ethereum’s enduring market leadership to its well-established ecosystem and consistent user engagement, which have reinforced its long-term position despite growing competition.

Solana, Aptos…