Sirwin
Sirwin

How many blockchains can there be?

By LeftFooted | bitcoinea | 13 Apr 2024


Almost by definition, blockchains tend to be built into, or designed for, open-source ecosystems.


If it's open-source, it's easier to replicate, or duplicate, and this is part of the reason why we've seen so many Layer 1 blockchains first, and also a lot of Layer 2 blockchains now.


So far, everyone has prioritised two things for the user and a few more things for developers.


For the user, understandably, the key metrics are always low fees and transaction speed, which makes sense. That's what people want. But perhaps we've sometimes compromised in terms of security, mind you that's kind of a side argument so we can talk about that another time.


For developers, blockchains generally try to 'advertise' themselves by showing how easy it is to build on that particular blockchain.


The key issue is, as the crypto world transitions from niche to mainstream, a few things will likely change.


Markets naturally tend towards monopolies. It's inevitable. This will happen in crypto, too, in fact it's already happening.


Bitcoin represents nearly half of the crypto market, and this will likely not change.


And when it comes to exchange, an extremely large proportions of transactions take place in Coinbase and Binance.


But when it comes to blockchains, I reckon many will simply wither and die, because today we've got so many that can basically do the same thing.


Without wishing to give examples, if blockchain A can do the same things as blockchain B but faster and cheaper and with the same level of security, then what's the point of blockchain B?


We'll see. We're still very early in crypto, though. So assume everything I just said is every bit as right as it is wrong. Because both are possible.

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LeftFooted
LeftFooted

I’m a left-footed duck that loves writing. I write about cars, watches, craft beer and, you’ve guessed it, crypto Also active on read.cash


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