Ethereum has long been the leading smart contract blockchain after its launch in 2015. It has faced contenders in Cardano, Stellar, and many other blockchains, but as of now, they have yet to make a serious dent into ETH’s market share.
This may be changing, though.
Bloomberg recently released an article branding the recently-launched Polkadot as an “Ethereum blockchain killer.”
Is Polkadot an Ethereum competitor?
Ethereum has faced down many shortcomings over recent months that have made many take a look at its competitors.
Namely, Ethereum’s relatively high block times of 13 seconds have disallowed certain applications from being built, and high transaction fees have dramatically limited the demographics and overall number of users that decentralized applications can have.
According to a Bloomberg article released on Oct. 17, Polkadot is the answer.
Polkadot is a blockchain network built by Ethereum co-founder Gavin Wood. It promises to offer a much better user experience than its predecessor due to its system of Parachains (sidechains), which allow for a high number of transactions to take place.
Bloomberg noted that per data from Outlier Ventures, Polkadot is starting to make waves in terms of its development community:
“While developer interest in Bitcoin and Ethereum has declined, the number of monthly active developers building on Polkadot increased by 44% in the 12 months ended in May, the report found.”
Of note, 253 projects are being built on Polkadot chains, from stablecoins and DeFi yield farming opportunities to social networks. This metric was under 200 in early September, Bloomberg reports.
Crucial to this growth, Wood explains, is the ability to use Parachains to customize the user experience:
“We are going to see a lot of different innovative products that can’t exist in a smart contract environment.Game blockchains, ensuring gamers don’t cheat. Blockchains within consortia. They are difficult to deploy in a smart contract environment.”
Dan Morehead, the founder of Pantera Capital, told Bloomberg that it thinks that over time, DOT has the ability to rally against ETH as it begins to eat up the latter’s market share.
It’s still well in the lead
By many measures, Ethereum remains in the lead of its blockchain competitors, even if its market share may be slightly slipping to new entrants like Polkadot, Solana, and others.
Ethereum is the only blockchain, after all, that the chair of the U.S. CFTC Heath Tarbert called “impressive.” He likened the network to the internet if Bitcoin was likened to email.
The platform has also seen serious institutional adoption, both in terms of ETH as an investment and Ethereum as a platform.
As CryptoSlate reported previously, analysis by crypto venture investor and analyst Adam Cochran indicates that “wallets associated with major players such as JPMorgan Chase, Reddit, IBM, Microsoft, Amazon, and Walmart” are buying ETH.
But maybe it isn’t a winner takes all scenario. Kelvin Koh, a partner at The Spartan Group and a former Goldman Sachs partner, says that he sees a world where multiple blockchains will work together:
“I believe in a multi-chain world inter-connected by bridges. Polkadot and Cosmos will not replace Ethereum. Also wouldn’t rule out chains like Near, Solana, AVA, TRON and others seeing development activity.”
I believe in a multi-chain world inter-connected by bridges. Polkadot and Cosmos will not replace Ethereum. Also wouldn’t rule out chains like Near, Solana, AVA, TRON and others seeing development activity.
— SpartanBlack (@SpartanBlack_1) August 22, 2020