Ethereum’s introduction ushered in a new era in the still-developing blockchain sector, shifting the industry’s focus away from cryptocurrencies as financial instruments and toward a more utilitarian purpose. Processes involving data transactions can attain autonomy while being irrefutable and transparent using smart contracts on Ethereum and comparable blockchains. Smart contracts are being used by both startups and established businesses to create low-overhead work flows, and creatives are incorporating them into their work as well.
Crypto Kitties, a recent project on Ethereum’s platform, was the talk of the town for a variety of reasons. Crypto Kitties’ concept is that users can use Ethereum to trade and breed virtual pet cats via smart contracts, resulting in some unique “cattributes.” The more unique a cat’s characteristic is, the more ETH it is worth.
Despite, or perhaps because of, the novelty of the concept, the basic game soared in popularity. Through the Crypto Kitties smart contract, it was able to temporarily take over 13% of traffic on Ethereum’s network. The catastrophe drastically hindered Ethereum and exposed some serious issues with its scaling attempts. (For additional information, see CryptoKitties Are Still a Thing.) This is why.)
The Achilles Heel of Ethereum
If Ethereum is to reach its goal of becoming the world’s “decentralized computer,” it will have a long road ahead of it. Even Ethereum’s developer, Vitalik Buterin, questions the network’s present scalability, saying, “Scalability [now] sucks; the blockchain design fundamentally relies on bottlenecks where individual nodes must execute every single transaction in the whole network.”
He is entirely correct. The Ethereum blockchain continues to grow in size, leaving a larger footprint on the hardware of both miners and users. Furthermore, its algorithmic programming is quite obsolete, making poor use of the chain’s processing capacity and returning a pitiful number of transactions per second. This is a concern for firms that use Ethereum smart contracts, and it has an impact on the currency’s future applicability and pricing. Fortunately, there are other blockchain-based smart contract platforms that are attempting to advance the concept.
QTUM is the abbreviation for “Questionable
QTUM, a hybrid cryptocurrency platform that combines the finest features of bitcoin and Ethereum, is one of the most potential candidates for Ethereum’s crown. The result is a solution that mimics bitcoin core but additionally contains an Abstract Accounting Layer that allows QTUM to use a more robust x86 Virtual Machine to implement its blockchain smart contract capability.
This is essentially an off-layer scaling solution similar to what bitcoin is attempting with SegWit and the Lightning Network, mixed with the ability to create and host smart contracts. This has made QTUM a popular choice among developers, who value the platform’s safeguards, which make it nearly difficult to commit the kinds of code errors that could one day turn into a multi-million-dollar disaster. They also like the availability of second-layer storage, despite the implications for decentralization, because stable business applications are, as it should be, their first priority.
Ethereum Classic (version 2)
The first hard fork in the cryptocurrency ecosystem was Ethereum’s split from Ethereum Classic in 2013, which resulted in the creation of a new prototype with the goal of filling in the gaps in Ethereum’s code. A hack in which one person stole over $50 million in ETH from a smart contract that was holding them in escrow as part of the first DAO (Decentralized Autonomous Organization) initiative sparked the uproar.
Following the hacker’s creation of a bug that allowed users to withdraw ETH instead of depositing it, the community agreed to construct a new chain that was backwards-compatible with the old one, allowing for mistakes like these to be corrected and funds to be returned to their rightful owners. The hard split added a new update to the old Ethereum code, making it impossible to revert, even in the event of severe breaches, which have occurred on multiple occasions. Thanks to a dynamic and active community, Ethereum Classic is constantly upgraded in this way, and despite its age, it stays up with other projects.
NEO is number three.
People often call to NEO as “China’s Ethereum,” and with good cause. For starters, both market themselves as hosts of decentralized apps (dApps), initial coin offerings (ICOs), and smart contracts. Both are open source, however whereas Ethereum is backed by a democratic development community, NEO has the full endorsement of China’s government. This has made it popular both domestically and internationally, as well as for its distinct value offer.
Instead of proof-of-work, NEO utilizes a more energy-efficient consensus method called dBFT (decentralized Byzantium Fault Tolerant), which allows it to process 10,000 transactions per second. It also supports more programming languages than Ethereum. People can create dApps in Java, C#, and, shortly, Python and Go, making it more accessible to entrepreneurs with bold ideas while also contributing to its long-term survival.
Cardano, number four
Cardano is a dual-layer solution with a distinctive twist, and it’s one of the newest entries in the smart contract platform competition. The platform has a control layer and a unit of account that oversees the use of smart contracts, recognizes identity, and maintains some separation from the money it supports.
Cardano is written in Haskell, a programming language that is best suited for commercial applications and data analysis, hence its future applications are likely to be financial or organizational in nature. Cardano is a potentially innovative solution because of its excellent balance of public sector usage and privacy protection, although it is still in its early stages. While the developer team’s rigorous, rigid scientific process may stall progress, it will be free of any parity or security flaws that plague its more hastily produced competitors.
Ethereum remains the gold standard for smart contracts and blockchain-based technologies, despite its flaws. These new rivals all have compelling value propositions, but they must first demonstrate that they can attract a large enough user base to achieve mainstream adoption and success.