Expanding Blockchains Could Compete with Ethereum, Research Shows

Expanding Blockchains Could Compete with Ethereum, Research Shows

New research released by Binance Research has revealed that Ethereum, the most popular blockchain in the world, is likely to see some fierce competition from other more scalable solutions in the future.

Ethereum is a name that is banded around in the crypto world and for good reason. The open-source public blockchain is used as a platform for hundreds of different tokens available today, and is by far the most popular blockchain option available.

Owing mainly to its accessibility and openness it allows developers to easily create and launch their own crypto assets upon it. As such, the lion’s share of newly developed assets are still released on its blockchain. 

However, they are not alone in the world of blockchain, nor do they operate as a monopoly. And as Binance Research discovered, its popularity could be under threat from ever increasingly popular blockchains with their own perks and benefits to developers and the limitations Ethereum has in comparison.

Where Does the Competition Come From?

The main issue that surrounds Ethereum is the issue of scalability, with it being noted that a wide range of abilities it promised, payment systems or gaming for example, never materialised. With the core aspect of the Ethereum system focused on funding.

This has thus led to a gap in the market which has been filled by other competing blockchains. With newly developed blockchains are now being built to solve these existing problems, with there being two main types popping up frequently recently, native and constructed.

For the former of these, a prime example would be Binance Chain, which as the research states “supports the creation of specific tokens on its chain”. While constructed would built with smart-contract functions instead, which would include Ethereum itself.

These latter ones are where the competition is mainly coming from. With expanding constructed blockchain like EOS, Ontology, and Tron being options currently posing the most threat to the blockchain status quo.

How Do They Compete?

Of course, there are some factors to consider as to the future of all these platforms. Binance Research has outlined 6 core aspects in which the future of blockchain will revolve around. These are as follows,

  • DApp Availability or Growing Use Cases– The more applications available the more likely developers will use it.
  • Transactions and Pace– The faster the blockchain, the better.
  • Blockchain Fees – Lower on-chain and token issuance fees provide more incentives to interact with the chain.
  • Easiness to build – Providing the elements which more straightforward cultivation of the blockchain make it more appealing.
  • Security and blockchain development– Improving the blockchain is important to maintain its optimal capability. While, of course, with any product, particularly those connected to finances, security is paramount.
  • Decentralisation – How decentralised the chain is can be an important factor in whether firms are going to want to use it, particularly for token stakeholders.

Concluding, however, Binance Research ultimately believes that “a wide variety of programmable blockchains will likely coexist if interoperability solutions across chains develop and prove to be both secure and usable. The rise of blockchain agnosticism, in conjunction with the convergence of best practices and programming languages, could further lead to a range of blockchains with different use-cases and communities at different scales.”

You can read the full report here.

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