The Race to the Moon: Why Crypto Projects Have to Modernize their Blockchains
Cryptocurrencies have, without a doubt, entered the mainstream. Cryptocurrencies, which were formerly seen as a fringe internet concept, are now adopted by some of the world's largest corporations and are receiving more media attention than ever before. The good news is that this bodes well for the sector and the blockchain technology that underpins it.
While bitcoin is typically used as an investment vehicle or a medium of exchange, blockchain technology's capabilities are nearly endless. Blockchain is being used in more places than ever before, from the supply chain to election procedures. This has sparked a blockchain arms race amongst the big ecosystems to see which will be the most scalable, safe, and useable.
Building on Existing Blockchains
Blockchains for major cryptos have existed for years, but the prospect of mainstream crypto adoption has never been more real. With major organizations embracing crypto and more developing use cases for blockchain, major ecosystems are no longer able to function as they once did.
When a business or process becomes more popular, it is necessary to scale its operations and make it more compatible with widespread use, and the blockchain industry is no exception. Tesla said in May 2021 that it will no longer accept bitcoin as a form of payment, despite previously embracing the cryptocurrency earlier this year.
The explanation provided was the significant environmental cost of running the Bitcoin network, which the corporation refused to contribute to. Around the same time, the Ethereum Foundation announced that it would convert from a proof-of-work to a proof-of-stake mechanism, reducing energy consumption by 90%.
The message is clear: as more individuals utilize blockchains, more steps must be done to make them more accessible to the general public and tangible to huge organizations.
Why Blockchains Must Scale
At this point, the question is not whether or whether blockchain ecosystems need to evolve, but how quickly they can. A lot of fundamental concerns have been allowed to fester for years within the industry, but they can no longer be ignored.
Smart contracts have been attacked in flash attacks and other ways on Decentralised Finance (DeFi) platforms, for example. Those who passionately believe in blockchain may be ready to wait for these platforms to address their security vulnerabilities, but the average consumer who uses centralized services may not be so patient.
Furthermore, some people see blockchain and cryptocurrencies with distrust, and the fact that blockchain ecosystems have a slew of scalability and security challenges does little to change that. These difficulties just add to the notion that blockchain and cryptocurrency are risky.
Finally, significant blockchain use is impossible without system updates and scalability. For good reason, the Ethereum blockchain has been working on scalability for years. Before it can onboard such a large number of users, a blockchain must be constructed to accommodate tens or hundreds of millions of people.
As blockchain and cryptocurrency become more widespread, the blockchains that are able to attain this level of scalability and security will be the ones to benefit financially. They'll also become the ecosystems that define what blockchains are and how cryptos should function (take ERC-20 tokens, based on the Ethereum blockchain, which is an industry-standard at this point).
The great blockchain race to build better ecosystems benefits the entire industry in the long run. It will result in better blockchains for users, a smoother transfer to the mainstream, and a more positive impact of blockchain on society as a whole.
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