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Ethereum, the open-source blockchain with smart contract functionality, processed 4.5x more transactions than VISA in 2021.
FUN FACT: #Ethereum processed 4.5x times more transactions than Visa in 2021.
— Watcher.Guru (@WatcherGuru) February 20, 2022
An in-depth report published on Medium showed that Ethereum handled the equivalent of $11.6 trillion in transactions in 2021. Visa transacted an estimated $10.4 trillion. And so, the cryptocurrency with the second highest market capitalization outperformed VISA, one of the world’s leaders in digital payments.
Nevertheless, 2021 was not an easy year for Ethereum. The platform faced numerous challenges. Apart from scalability issues, the arrival of rival smart contract platforms threatened Ethereum’s dominance.
However, Ethereum was able to crush all of them. Notably, the network was able to stay on top because of its innovative protocols. Ethereum underwent a technical upgrade in August of 2021 — London hard fork EIP-1559. This upgrade resulted in 4500 ETH being burnt within 24 hours at 2 ETH per minute. And, this helped reduce the gas fees. Alongside this upgrade, Ethereum also deployed Layer 2 scaling solutions. All this increased the transaction capacity of Ethereum.
In 2021, Ethereum’s L1 was able to process over 1.2 million transactions per day. This amounts to 15 transactions per second. When Layer 2 became available, this grew even more. These developments are a major reason that propelled Ethereum to gain such record-high transaction volume.
Another significant cause for Ethereum’s massive boom is the creator economy going mainstream. The creator economy on Ethereum flourished with the expansion of NFTs. This pushed Ethereum to become one of the biggest platforms for creators globally.