Ethereum Faces Turbulent Times Amid Layer-2 Wars and Regulatory Uncertainty

Ethereum is currently navigating a complex landscape, with its price action influenced by various factors. The cryptocurrency's recent performance has been characterized by sharp spikes and deep wicks, reflecting the intense rivalry between bulls and bears.

The Layer-2 wars, which pit different scaling solutions against each other, have become a dominant theme in Ethereum's narrative cycle. Arbitrum, Optimism, Base, and zkSync are among the prominent players vying for market share and user adoption.

Regulatory noise, ETF flows, and institutional investment also play significant roles in shaping Ethereum's price action. The Ultrasound Money thesis suggests that Ethereum's supply dynamics will favor deflation over inflation, potentially bolstering its long-term value proposition.