Re-examining Ethereum: What Are the Bullish Cases?
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Re-examining Ethereum: What Are the Bullish Cases?
Is now a turning point for Ethereum to revive its price?
Navigating Web3 tides with focused insightsHost: Alex, Research Partner at Mint Ventures
Guests: Zhou Qi, Founder of EthStorage; Lawrence, Researcher at Mint Ventures
Hello everyone, welcome to WEB3 Mint To Be, brought to you by Mint Ventures. Here, through persistent questioning and deep thinking, we aim to clarify facts, understand realities, and seek consensus in the WEB3 world. We aim to uncover the logic behind the headlines, provide insights that go beyond surface-level events, and introduce diverse perspectives.
Alex: On this episode, we're joined by Dr. Zhou from EthStorage and our researcher Lawrence. We'll be discussing a blue-chip asset that many crypto investors care deeply about—Ethereum. Ethereum’s performance throughout this market cycle has generally been underwhelming—it's consistently lagged behind BTC and, for most of the time, also trailed its competitor Solana. However, Ethereum has recently undergone several notable changes: Vitalik has taken a firm stance on Layer1 scaling, the foundation has restructured and laid off staff, and overall, there's a more pragmatic approach emerging. Is this now a turning point for Ethereum to reclaim its value? Before diving into our discussion, let's first have our guests introduce themselves. Dr. Zhou, please go first.
Zhou Qi: Hi everyone, I'm Zhou Qi, founder of EthStorage. I'm excited to share our insights on Ethereum, including some of the work we've been doing on the network. Back in 2017 and 2018, we began deeply researching Ethereum's technology, especially its scalability roadmap—from early Layer2 approaches to today’s Layer1 focus. We’ve participated in many Ethereum research initiatives and received extensive support, including grants for research on data availability (DA) and work related to the OP Stack. So today, we’re thrilled to offer some unique perspectives from our experience.
Lawrence: Hello everyone, I'm Lawrence from Mint Ventures. Glad to be here with Dr. Zhou to explore this topic together.
Why Ethereum Has Underperformed BTC and SOL This Cycle
Alex: Let’s dive into the main topic. Before exploring the bullish arguments for Ethereum, let’s first outline the challenges it currently faces. In your view, what are the main reasons Ethereum has significantly underperformed both BTC and Solana this cycle? Dr. Zhou, would you like to start?
Qi Zhou: I see a few key factors. First, Ethereum’s roadmap—especially its long-standing focus on Layer2—has turned out to be misaligned with Ethereum’s core value proposition. This was actually a topic I discussed with Vitalik when I met him last month in East Asia, and it aligns with his current thinking. For example, before EIP-4844 launched last year, Ethereum was still in a deflationary state. But after 4844 went live, L2s gained much cheaper data posting costs to Ethereum, while much of their generated value no longer flowed back to Ethereum itself. Projects like Base and Arbitrum collect substantial user fees, but those fees don’t directly benefit Ethereum. This creates a major misalignment in incentives. Second, because Ethereum performed so well in the previous cycle, it may have become complacent, slowing down engineering progress. At that time, Ethereum had no real challengers—neither Bitcoin nor Solana posed a serious threat. But this cycle, many complain that Ethereum is moving too slowly, with ambitious roadmaps but little actual delivery. Each upgrade takes one to two years to implement. Compared to Solana’s aggressive engineering pace, Ethereum has prioritized research over rapid execution. This model has caused significant delays in development. We’ve experienced this firsthand—over the past few years, we’ve contributed many EIPs, including the EthStorage proposal. To summarize, these are the two primary issues.
Lawrence: The two points Dr. Zhou raised are exactly what I wanted to mention. Another important factor is that this cycle has seen relatively few new blockchain business models or breakthrough innovations. Overall on-chain activity and application diversity haven't improved much since 2021—in fact, if we exclude meme trading, they may have slightly declined. Meanwhile, Bitcoin’s fundamentals have strengthened dramatically. As a result, all Layer1 blockchains have struggled comparatively. Even Solana, which has performed relatively well, still trades at least 50% below its 2021 peak against BTC—the current high is 50% lower than the last cycle’s high. This is a shared challenge across all Layer1s. Additionally, as Dr. Zhou mentioned, there’s what I’d call a strategic failure over the past few years: the Layer2-centric strategy. More fundamentally, I see this as a structural issue rather than just a short-term misstep. I’ve read critiques from many people, particularly one by Max Resnick, which I find very telling. Max was previously a researcher at the Ethereum Foundation but moved to Anza—a research team spun out from Solana Labs—at the end of 2024. While at the Foundation, he was skeptical of the Rollup-centric approach and instead advocated for Layer1 scaling. He’s offered sharp criticism, arguing that Ethereum’s roadmap architects—Vitalik in particular—excel in cryptography and blockchain theory but lack depth in computer systems research. This, he believes, has led to fundamental misunderstandings about blockchain performance bottlenecks. For years, the Foundation assumed the bottleneck was in execution, but according to Max, it’s clearly in consensus. He also criticizes the leadership for being overly focused on distant, abstract goals—like privacy and social applications—while neglecting current users. Vitalik often writes about privacy apps on his blog, but says little about DeFi. Yet, DeFi remains the dominant use case on Ethereum’s mainnet. This disconnect sparked debates last July and August between Vitalik and top DeFi teams. These factors contribute to Ethereum’s low R&D efficiency: a gap exists between researchers and developers, and progress is painfully slow—one major upgrade per year. Take the shift to PoS: Vitalik proposed it around 2015–2016, but it wasn’t fully completed until the Shanghai Upgrade in 2023. Since 2021, major upgrades have been scarce: Merge in 2022, Shanghai in 2023, Cancun last year, and the recent Pectra upgrade. This slow pace leads to high correction costs, especially in time. For instance, the Layer2 strategy: Vitalik pushed for a Rollup-centric vision in 2020, but implementation didn’t begin until 2022. Now in 2025, we’re realizing it’s not working and need to pivot. That’s a huge waste of time—especially compared to Solana or newer chains like Sui, whose development cycles are nearly an order of magnitude faster. Ethereum might take ten times longer to make a decision and ship it. There are reasons: Ethereum is the first major blockchain after Bitcoin, facing complex challenges including regulatory scrutiny and an extreme commitment to decentralization. But from an outcome perspective, the issues we’ve discussed represent long-term structural problems within the Ethereum Foundation and its core leadership. Those are my three main points.
Alex: OK, I’d like to add one more point. Lawrence touched on this—Ethereum’s top-level insistence on decentralization has been extremely rigid. Until the last cycle, this was widely seen as essential to blockchain legitimacy. But things have changed. A key shift is in U.S. governance: the current administration is highly crypto-friendly with relaxed regulation. This reduces the urgency for anti-censorship and resistance to government crackdowns. Ethereum’s extreme focus on decentralization now seems less necessary. Chains like Solana and Sui, which sacrifice some decentralization for higher efficiency and performance, now hold an advantage. Looking ahead, even if Democrats return to power, they’ll likely recognize the importance of the crypto investor voting bloc. I believe they won’t pursue the harsh crackdowns seen under Gary Gensler. Thus, the necessity of radical decentralization is fading industry-wide. Many new projects this cycle—like Ethena, or the growing narrative around RWA—are hybrids of CeFi and DeFi. This trend undermines Ethereum’s traditional consensus. It’s partly why Ethereum’s narrative appeal now lags behind Solana’s.
Consensus vs. Non-consensus on Ethereum’s Problems
Alex: Let’s move to the next question. We’ve discussed many of Ethereum’s issues—engineering capability, strategic direction, slow error correction. Now, among Ethereum’s leaders, community, and developers, what problems do they agree on? And where do disagreements remain? To put it simply: which issues are universally recognized as problems—from core leadership down to developers? And which ones are contested—where we see a problem, but Ethereum sees it as a deliberate design feature? What are your thoughts? Dr. Zhou, please go first.
Qi Zhou: One major shift is in how Ethereum defines decentralization. A few years ago, Ethereum pursued decentralization in an almost religious, idealistic way. I remember talking to Ethereum insiders who dreamed of making Ethereum L1 a minimal trust layer—so lightweight that even phones or simple embedded devices could run validators. But now, after challenges from networks like Solana and new L1 scaling plans—such as increasing gas limits and introducing block-level access lists to speed up execution—they’re taking a more pragmatic approach, balancing decentralization with execution efficiency. This means accepting that validators may require more powerful hardware. The reality is, the real barrier to running a validator isn’t your device—it’s the 32 ETH requirement. At current prices, that’s nearly $100,000. So why not relax the assumption? Why not allow $1,000–$3,000 machines to run nodes while scaling L1 throughput by 2x, 3x, or even 10x? That’s Ethereum’s new plan. It’s a practical adjustment. For example, two years ago, we submitted an ESP grant proposal to study block-level access lists. The idea: when packing a block, inform other validators which data will be accessed, enabling prefetching of account balances and other data to boost execution speed. We requested only $10,000—but were rejected without explanation. We suspect Ethereum thought it compromised decentralization and wasn’t a priority. But earlier this year, they suddenly invited us to collaborate on the same research. This shows a paradigm shift—from ideological purity to practicality. With computing power improving and costs dropping per Moore’s Law, sticking to old constraints like fixed gas limits or ignoring access lists would cap performance and prevent 10x scaling. Two years ago, I wondered why they ignored this. I could only interpret it as stubborn idealism.
On non-consensus issues, I believe Ethereum carries significant “debt”—technical debt, cognitive debt, even brand debt. When making big changes, it can’t easily reject its past. Historical parallels exist—China’s reform era or Soviet leadership transitions—where gradual, steady reform proved more effective than abrupt overhaul. Take the multi-client architecture: Ethereum runs four or five different clients in execution and consensus layers, written in different languages. But historically successful infrastructure—like Solana, Linux, or HDFS—uses a single language and test framework to maximize engineering efficiency. Ethereum adopted multiple clients due to the DAO hack, fearing a single language flaw could bring down the network. Since Ethereum evolves rapidly—unlike Bitcoin, which is largely static—they accept 10x engineering overhead to mitigate risk. But this means Ethereum needs 5–10x more engineering effort to match Solana’s pace. That’s why upgrades take so long. Having participated in EIP processes, DevNet, and TestNet, I know coordinating across clients consumes massive effort. During the Pectra upgrade, for instance, a config mismatch in Geth caused desynchronization, requiring emergency fixes. It’s a trade-off. This raises a deeper question: must a fast-evolving system like Ethereum never go down? Solana has crashed multiple times. Maybe we should tolerate downtime if recovery is fast. Maintaining a single client could accelerate iteration. In big tech, I’ve seen downtime is normal—even Meta or Google suffer full outages. So how to balance resilience and agility remains unresolved—and deeply debated.
Lawrence: I think the current consensus is clear: the old Layer2-centric strategy must change. The Ethereum Foundation has recently signaled this shift, and the community has long doubted that path. Though the Foundation uses softer language—“reprioritization”—many see it as a full pivot, implying past mistakes. But in practice, refocusing on Layer1 and abandoning the rollup-centric model is now widely agreed upon.
The non-consensus issue, as Dr. Zhou noted, is how far Ethereum is willing to go in compromising decentralization. Many inefficiencies trace back to this principle—supporting multiple clients, maintaining solo staking, prioritizing individual validators. These choices hurt coordination and speed. I’ve followed Lido closely. The Foundation hasn’t signaled any shift—no indication that solo staking is less important or that centralization is acceptable. Ethereum was born in contrast to Bitcoin, positioning itself as a rebellious alternative to global finance. Hence, anti-regulation and anti-censorship became core values. Unlike Bitcoin, Ethereum has identifiable leaders, making it more vulnerable to legal action—so caution prevailed. But look at Solana: labeled a security by the SEC in 2023. Ethereum feared this, but Solana thrived anyway. So how much decentralization can we sacrifice? How much compromise is acceptable? There’s little discussion on this. It’s a long-term issue that will continue to impact Ethereum’s efficiency—and it remains unresolved.
Ethereum Reform Timeline
Alex: Okay. We’ve covered the problems and the degree of agreement on them. Now, regarding the issues everyone agrees on, what countermeasures has Ethereum’s leadership planned? What’s the rough timeline? For example, two recent developments: Vitalik’s goal to achieve 10x scaling by year-end, and the Foundation’s recent restructuring and layoffs. What key events do you expect, and do they follow a shared timeline? Dr. Zhou, please go first.
Qi Zhou: First, Ethereum has published a clear L1 scaling roadmap—raising the gas limit from ~30M to 60M and beyond, backed by specific EIPs. Second, clients like Geth are actively optimizing code. For years, client-side data caching was inefficient—we noticed this but didn’t investigate. Today, transaction execution runs at about 100M gas/second. If we raise the gas limit to 300M (10x), execution alone could take 3 seconds—risking timeout, since Ethereum has strict 12-second windows for block production, voting, etc. Interestingly, Nethermind implemented caching optimizations that boosted performance 3–4x, reaching 400–500M gas/second—verified and reproducible. Just recently, Geth released updates achieving similar results—without changing any consensus or execution specs. It turns out Geth hadn’t prioritized optimization for years. Only when pressured by competitors did they act—now seeing 4–5x gains. We once thought Nethermind’s leap was magic or measurement error. Turns out, everyone was complacent. Now we know 3–4x improvements are possible immediately, and 10x may be feasible. The old belief that 100M gas/sec couldn’t scale further is outdated. This pressure-driven progress is positive. Solana, despite its own struggles, may ultimately push Ethereum to improve—benefiting the entire ecosystem.
About the layoffs—there’s a story. We collaborated with Portal Network, an official Ethereum project solving post-scaling data storage. Ethereum’s historical transaction and state data totals ~1TB. With 10x scaling, it quickly exceeds 2–3TB. The goal was decentralized storage with lower node costs—achieving scalable decentralization. We worked closely with them for 1.5–2 years. Then, one Monday, they abruptly canceled the project and laid off all full-time staff. This shows Ethereum’s determination: anything not directly advancing scaling is no longer a priority. Their resolve is strong.
Lawrence: The timeline is still vague—e.g., 10x L1 scaling within a year, 100x within 2 or 4 years. But Dr. Zhou’s example reveals past failures: execution-layer optimizations offering 5x+ gains were ignored for years. The response includes strategic shifts—recentering L1—and organizational changes: two new executive directors, Wang Xiaowei and Tomasz Kajetan Stanczak (founder of Nethermind). Recent layoffs and a newly published budget framework signal restructuring. More details may emerge later. But these two new leaders have two-year terms starting this year. Given their engineering backgrounds, they should help meet scaling goals. Wang has long researched sharding; Tomasz’s Nethermind recently shocked other clients with its performance. Their arrival bodes well for tangible improvements in Ethereum’s speed.
Is Ethereum Still Worth Believing In?
Alex: Bringing it all together—Ethereum has problems, but is making changes, and still holds advantages. Looking ahead, do you both still believe in Ethereum—as an investment asset? What are your reasons? And which of those reasons do you think the market is currently overlooking? Dr. Zhou, please start.
Qi Zhou: My view is cautiously optimistic. On the optimistic side, Ethereum is a rare, decentralized ecosystem with a vast, active developer community—something truly impressive in web3. When I talk to traditional tech studios unfamiliar with crypto, they often compare Ethereum to Nvidia, Apple, or Tesla. It has strong fundamentals and powerful network effects. Personally, if crypto were only Bitcoin, without new innovations, the space would be boring.
My caution stems from history: Ethereum was driven by idealists who received strong early feedback. But as they confront real-world challenges, their overly idealistic assumptions are exposed. If the Foundation avoids bold reforms or fails to execute them thoroughly, backlash is possible. It’s human nature—once you reach a peak, maintaining初心 (original intent) and relentless drive becomes extremely difficult. So I remain cautious.
Lawrence: I’m still somewhat bullish, though less so than in the last cycle. My reasons: first, a large number of top-tier developers continue building on Ethereum—people like Dr. Zhou. This is a critical competitive edge. While some new apps now launch directly on Solana or Sui, many early, experienced crypto builders still prefer Ethereum or the EVM ecosystem. That’s a strong argument for long-term confidence. Second, although new app trends often debut on Solana, financial applications—RWA, Ethena, and arguably HyperLiquid—still see innovation on Ethereum. As regulations loosen further, more financial apps may still choose Ethereum when selecting a chain. Third, in the near term, we’ll likely see clear improvements in Ethereum’s performance and lower fees. This could trigger a strong short-term rebound—a “buy the dip” moment—as market sentiment shifts.
Like Dr. Zhou, I’m cautiously optimistic. Ethereum may improve in the medium term, but its long-term trajectory is uncertain. After the two new executives finish their two-year terms, what happens next? Will Vitalik evolve—prioritizing current users and short-term metrics over distant, abstract ideals? If not—and if his influence remains unchanged—Ethereum may remain slow and overly conservative compared to Solana or Sui over the next 5–10 years. In that case, its early-mover advantages—developer mindshare, financial app dominance—will gradually erode. If Ethereum stays this slow in the next cycle, it may no longer be a compelling investment.
Under What Conditions Would You Increase ETH Holdings?
Alex: Finally, a direct investment question. Ethereum’s valuation relative to Bitcoin has been declining. Now, positive signs are emerging. For each of you personally, what facts, data, or signals would give you enough confidence to buy or increase your ETH position—or raise its allocation in your crypto portfolio? What would those indicators be?
Lawrence: Right now, waiting for data might mean missing the price move—price often leads data. What I’d really like to see is Vitalik publicly say: “We were wrong. Now we’re changing course.” I sense that everyone is telling him he’s wrong, and he’s reluctantly trying new approaches. Vitalik’s influence over Ethereum is unmatched. It may weaken with the new executives, but for now, he’s still the most influential figure. I’d gain confidence if Vitalik himself became more aggressive—or if someone like Tomasz gained greater internal influence.
Another signal I want: Ethereum making a mistake. They’ve always avoided errors, aiming to build something that lasts 100 years. They accept slowness but demand perfection—which is excessive. As Dr. Zhou said, mistakes are normal. Solana has crashed many times; new chains fail often. Ethereum is too cautious. I want to see it become bolder, less risk-averse. If I see such signals from leadership, I’d consider adding. Of course, I already hold a significant ETH position, so I’m extra careful about timing additional buys.
Qi Zhou: From a valuation perspective, our industry lacks established frameworks. When deciding to buy ETH, I’d weigh two factors. First, the macro environment: Ethereum has such strong network effects that as long as it moves toward practicality—and you don’t buy at peak hype—there are likely solid investment opportunities. After multiple cycles, Ethereum still offers many entry points. Second, whether Ethereum sustains its pragmatic decision-making. This raises deeper questions—not just about Ethereum, but about large organizations and communities. For example, why is there so much FUD around Ethereum? Many feel Vitalik is surrounded by people exploiting or overselling him. Meanwhile, grassroots contributors feel he’s disconnected—information asymmetry, noise, difficulty identifying talent. This is inevitable at scale. The key is how Vitalik builds better teams, listens to the community, and acknowledges past mistakes. But this process needs to be smooth. A sudden break—like Khrushchev’s rise—could split the community. Vitalik needs more introspection. Crucially, how does he filter community input and open doors for more contributors? Earlier, he designed Ethereum as a “sovereign-free” project, distancing from ideologies he disliked. For example, Trump’s pro-crypto actions—dinners, hearings—I notice Vitalik keeps his distance. He’s more active lately, traveling, but hesitates on sensitive questions: Should Ethereum open an office in Hong Kong? Attend Trump’s dinner? Join U.S. hearings? He seems hesitant. Not opposition—just hesitation. But ecosystem growth requires local community support—from the public, elites, and regulators. I recall reading his blog—he once had ties with Putin, given his Russian roots. But after the Ukraine war, he strongly opposed it and declared he’d never engage with sovereigns again. But rejecting all engagement isn’t practical. As we say in China: “Make friends with as many as possible, enemies as few as possible.” With that mindset, Ethereum still has tremendous potential.
Alex: Thank you both for your generous and insightful contributions today. We hope to invite you back for more discussions in the future. That concludes today’s episode. Thanks for listening.
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