JPMorgan reported that ether (ETH) has been underperforming compared to bitcoin (BTC) and other cryptocurrencies due to intense competition from alternative networks. The bank highlights that ether lacks a compelling narrative akin to bitcoin's reputation as a store of value and digital gold. Despite recent upgrades, including a layer 2 launch, activity is increasingly migrating from Ethereum's mainnet to these layer 2s, negatively impacting Ethereum's growth potential. The report cites this migration as detrimental because decentralized applications (dApps) such as Uniswap, which are significant gas consumers, are moving to other platforms, leading to diminished transaction fees and validator revenue for Ethereum. In comparison, competitors like Solana have experienced surges in activity, especially around memecoins. Nevertheless, Ethereum continues to dominate decentralized finance (DeFi) and non-fungible token (NFT) sectors, but JPMorgan anticipates ongoing fierce competition which could hinder Ethereum's institutional demand.

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