Much of the recent buzz in the crypto world has surrounded the potential of decentralized apps (DApps) and real-world use cases outside of the current narrow focus of payments. Commentators envisage a world where online and offline actions can be facilitated with a new level of trust and automation with the addition of a blockchain layer to the economy. They envisage a situation where new business use-cases drive startups to constantly fork and improve on existing blockchains, or build new applications on the existing infrastructure.
While this sounds exciting, the turbulent world of crypto has had shown mixed progress in this regard. An example of both the promise and pitfalls of the current crypto ecosystem was the release of the CryptoKitties app on the Ethereum blockchain. While it became very popular, it burdened the Ethereum ecosystem heavily, and more importantly has not been followed by other DApp releases as popular since. Aside from DApps, the multitude of forks of existing platforms has seen mixed results in terms of genuine innovation.
Here we will take a look at examples from the main platforms in this corner of the cryptosphere to see if we’re actually getting closer to a blockchain-leveraged innovation ecosystem, or if it’s mostly just hype.
In many ways the first major DApp project, Ethereum is of course geared to business cases beyond simple financial transactions. It has been heralded by many as the future of blockchain but has had a rougher scale up than was hoped for. As you know, the CryptoKitties application slowed the network to a near standstill when released, and other high-profile incidents like the DAO hack have brought some scepticism to the conversation around Ethereum.
That being said, the project is undoubtedly a crypto trailblazer. The reason for some disappointment with Ethereum is due to the significant hype following it around, and in fact, there have been some impressive launches on the protocol. Of interest are Augur (a decentralized prediction market) or Maker/Dai (which is a stablecoin that doesn’t rely on outside cash reserves and instead uses smart contracts to maintain price stability). Both projects, as well as a few others, demonstrate the kind of maturity that should be reassuring to followers of Ethereum’s progress. This, along with the intensive efforts to improve the ecosystem from the main dev team through sharding (among other things) suggests that there is a lot of genuine hope when it comes to the hype of ETH.
In some ways, Stellar was designed to pick up on some things where Ethereum left off. It specifically aims at blistering transaction speed, many times quicker than with ETH. It also tries to make the whole process of starting up easier for DApp makers, and claims a new developer can have a token derived on the Stellar blockchain within 24 hours. Stellar itself is a fork of the Ripple protocol, and wanted to improve decentralisation and programmability of the Ripple system.
One of the most successful and relevant apps to this discussion is the Mobius Network built on Stellar, which in turn allows DApp developers to build on this protocol ecosystem easily (with the company claiming that any developer can use it to create easy blockchain solutions). Mobius boasts a healthy community of DAppsters so far.
Other projects have built from the Stellar protocol to innovate. Traxalt is a platform that wants to make business transactions much smoother and more analytical. Currently, companies hire an army of accountants, administrators, and analysts to manage their financial processes. Traxalt is aiming to use the transparency and efficiency developed by the Stellar team to make this complexity a thing of the past.
While Stellar and its derivative partners have seen good progress overall, the Turing-incomplete nature of the platform will prevent it from being used for more complex business cases, and it remains to be seen if the platform can make a name for itself in the DApp space.
NEO is well worth a mention here. Dubbed “the Ethereum of China”, NEO has made steady progress of late; it is very focussed on its role as DApp facilitator and boasts quicker transaction times than Ethereum.
There have been some interesting releases and forks from the NEO protocol of late. Projects like the Switcheo Exchange and the Bridge Protocol are most notable; Switcheo is a decentralised exchange which interacts with both the Ethereum and NEO blockchains to allow for more efficient transactions, while Bridge is a solution to the ever-expanding (and complicated) KYC/AML verification market (where users can store their verification proof privately and securely on the blockchain protocol to be divulged to 3rd parties when needed).
While NEO is certainly moving forward, some scepticism remains about the viability of the platform as a rival to Ethereum and the like. It is much more centralised than other platforms, which led to the system crashing in 2018 when a node failed. The HQ location of NEO in China might also cause concern, given how the Chinese government have often had either antagonistic or controlling influences over crypto firms there.
Which way for the state of the ecosystem?
Here we’ve had a brief look at some of the promising and worrying developments in the area of innovation in crypto. Overall, it must be said that most of the hype of the past 3 years has not amounted to much – there is no doubt that the DApp revolution has not hit the mainstream as many had hoped. That being said, there is no sign that this will never happen and in fact every week we hear more promising news that blockchain is making its way into the real economy bit-by-bit. It might just be a little more slow and steady than expected.