Yeah Baby! Flippening you're the new star!
ERC20 traction is real and its, say what? Polkadot leading the way? WTF?
Ethereum What Happened?
Well let me speculate on what happened to ETH, the speculators jumped in, that is what happened, big ones, with Whales spilling their investment flow over the lip of the BTC glass as they filled it up to their risk levels and then directing the excess flows into the ETH glass, where the smart flows quickly realized they were riding the wrong ERC20 horse and jumped to Polkadot? ( only to ask themselves are the developers really migrating here or, is DOT yet another "marketing spin trap" ?)
This "Two for One" CryptoTKOs issue attempts to bring some clarity to what's "in store" for the 'Flippening in Progress' investor types, with some glance under the hood in the big three swim lanes to try to make some sense of it all with a guest appearance by other rising stars in the ERC20 Ecosystem namely the recently much maligned #BAT and a few others powering the "Rise of the Flippening"
ERC20 Ecosystem- Growing due to the HyperSpin of DOT or is there more to it?
The Smart Contract market growth dynamics of the ERCxx world is powered by developer zeal.
OK, so what value does that "zeal" really bring to the world of business? In short, the middleman (lawyers and accountants on both sides of transaction) get cut out, by cryptographic protected Smart Contract Logic which in the case of Ethereum, these smart contracts in Ethereum 1.0 are validated by ETH miners trying to guess the current "epoch" nonce (having a PoW "Proof of Work" hash rate requiring a bunch of CPU cycles to reiteratively guess the nonce) in order to win the 'job' of encrypting the next block of transactions and, in return receive a reward denominated/valued in Ethereum, where the transactors also pay a gas fee in the same denomination ETH.
It should be noted that ETH 1.0 requires the entire set of validation nodes on the Ethereum blockchain to validate the result before issuing the reward, a slow process, which also chews up power, driving the miner costs up, those guys that pay the power bills to keep the Ethereum blockchain transaction handling and reward issue systems running.
Ethereum 2.0 promises a lot of things with Proof of Stake being the big one, whereby less power is used, settlement time are faster and the number of TPS "Transactions per Second" scales beyond what is an anemic ETH 1.0 6-15 TPS depending on whose data you want to believe.
What really makes Ethereum interesting to developers is the protocol ERC20 and, some of the companion protocol variants which have emerged over the past few years. ERC20 has allowed developers to fork the Ethereum open source code and modify/extend the basic functionality to do other things, like what the Brave Browser folks have done to create a permissioned based Advertising buy and delivery service to their Brave Browser, which also tips the viewer of ads with ERC20 BAT tokens, readily exchangeable in many places back to Ethereum which shares the same protocol ERC20.
All good, except how does that "exchange" actually happen? Rather than dive into a deep tech explanation, suffice it to say that Central Exchanges have provided that exchange service for a few years now quite successfully, for a fee of course, which varies demanding on market demand.
The Blockchain Routing Creatures from the ERC20 Lagoon
Recently, the world of Inter-Blockchain Settlement and routing has emerged to create a new set of ERC20 entrants which compete directly with the central exchanges, under the term Blockchain Routing.
Polkadot has astonishingly (imo) soared to the top of the tables, powered by a lot of speculation, largely due to the quality of their technical spin, to "leapfrog" early entrants Chainlink and Cosmos, even passing the solid emerging Smart Contract offer of #Cardano along the way.
OK what gives, how can this be? What is the real PolkaDOT attraction? Are Developers really leaving Ethereum in droves to write for DOT?
PolkaDot under the Hood: Team, Special Sauce, Key Use Cases, Developer Adoption, Future Prospects
The Team Leader Gavin Wood has seen Ethereum up from and personal, he was a co-founder along with a few other claimants.
OK his linkedin says he was there until 2015 (vamped out in Zug, CH) where he then started Parity Technologies to create or presumably improve on ETH, creating with others what is now called Polkadot and the DOT cryptocurrency "hard store of value". Per CryptoSlate post Jan 1st, 2021
"According to Wood’s Medium post, the development of Polkadot picked up the pace this year. The blockchain’s Rust codebase now has over half a million lines of code, while its Substrate Technical channel has almost tripled the number of developers in it to 2,600."
OK 2600 developers is big number claim so lets look at the Polkadot open source repository and see how many 'Watches' the DOT project has:
OK so 270 watchers, but more importantly 478 Forks, which means there are probably more than one person working on each fork..., so the claim imo likely stands up.
One "gottya" is the DOT adherence to GPL 3.0 licensing , if you build special add-on sauce, if your not careful in terms of API use, and acknowledgement of licensing in your code, GPL 3.0 owns your code (thank you Greg Stahlman), so the socialist open source model is in play at DOT.
Partiy's selection of RUST is imo, a good choice of concurrent programming languages (Go language is the other "concurrent" biggy from Google) given RUST has safe multi-threading, built in Garbage Collection and, the speed close to C and, sort of looks like C, without the malloc "memory allocation" problems which can spring memory leaks, often hard to find and fix, because they show later during code operation to crash your application. All this means is the solution written in RUST (or Go) can concurrently (handle alot of threads in parallel safely) which means the solution can scale the TPS up (within the box) and out(across boxes) big time to meet huge swarm of user demand for fast settlement. (in a few seconds)
CryptoSlate points out Parity Technologies' approach is to effectively hand out cash in the form of DOT to initially get developer's attention and get them hooked. (Beats chasing crickets in the basement to catch an "in between coding" snack.. ;) )
So what are the actual business needs which DOT satiate at the moment and how is the advantage created sustainable over what is coming from the ETH 2.0 camp?
Your answer generally is: lots of use cases, check out the link attached by clicking on the graphic below
"This year alone, over 200 projects have been funded through the blockchain’s various grant programs and treasuries—Polkadot’s treasury alone funded a total of 23 proposals with over 118,000 DOT in the last few months alone. The Web3 Foundation’s ongoing grants program has granted $4.1 million to 145 different proposals, Wood said in the post."
It's hard to beat this organized DOT Candyman, at the moment.., if you are building a Smart Contract project...
Future Prospects for PolkDot? - to the Moon, maybe even leaving ETH 2.0 in the Rear view Mirror..
Maybe by 2023. My thinking is Parity is leaner, meaner and powered by their focused desire to make DOT Number #1 in the general purpose Smart Contract space supplanting the ETH community. ETH 2.0 camp needs to pick it up a bit and really start delivering, but before they can do that, they need to get better organized and prioritized. Why 2023? Well the Smart Contract Market is huge with different segments emerging where its impossible for one size of smart contract platform to fit all use cases.
I won't speculate on price points for ETH or DOT in this issue, as in my opinion, a lot is happening politically right now and the money supply thing in the fiat world is more likely to impact this part of the market , versus Bitcoin. Let's just say it will be a roller coaster ride for the next 6 months, until the US settles into their new administration post the interim situation they have at the moment.
My next issue #003, will be exactly focused on one such market segment, the Machine Economy, hi-lighting the smart contract progress at #IOTA relative to other SC IoT competitors in that Smart Contract Segment part of the world.
TK over and out!