Ethereum has managed to remain, since its birth in 2015, as the undisputed leader of decentralized applications or “dApps”. Possessing in its network the largest number of gaming platforms, cryptocurrency exchange and NFT (non-fungible tokens).
Nowadays Ethereum has USD 117 billion in TLV, which represents 58% of the total money handled by decentralized apps on the marketaccording records the Defi Llama scout. The TVL is the total value locked of crypto assets in the decentralized finance space as collateral.
The percentage handled by Ethereum is five times higher than the second blockchain on the list, Terra, which occupies just 8% of the total TLV in dApps with USD 15 billion. This is especially curious, given that Ethereum currently has much higher fees than other networks, such as Terra or Solana.
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Regarding dApps or decentralized applications, the concept refers to the fact that they are not governed by a central entity, as is the case of a company or organization. Allowing users to interact without intermediaries. Currently dApps are booming.
An example of this is reflected as in the last month in Ethereum the most used dApp (OpenSea) registered close to 500,000 monthly active users, while the exchange UniSwap V2, mobilized about USD 118 billion in ETH and tokens from the network. This according to the explorer DappRadar.
Although it is worth clarifying that the boom in decentralized applications has not only been seen in Ethereum. In fact, over the last year some have developed on cheaper networks, causing Ethereum to lose its dominance from 95% to 58%.
However, that percentage is still quite considerable compared to that of all the competition together, as can be seen in the previous graph. This shows that, even with higher fees than other networks, Ethereum is still the most widely used network.. Why?
Ethereum is more decentralized and secure than other networks
The main reason why Ethereum continues to be the most used blockchain for dApps is probably because of its decentralization power.. This is how two ecosystem specialists who CriptoNoticias had the opportunity to consult consider it: Evan Van Ness from the United States and Pablo Sabbatella in Argentina.
Evan Van Ness, co-founder of the “Week in Ethereum News” page which reports Ethereum technical news, told us: “People stick with Ethereum because it is the most decentralized network out there. If you wanted a centralized system that failed, you would continue with the same. But if you want decentralization, you go with Ethereum.”
If there is something that represents the cryptocurrency ecosystem, it is the value of decentralization and this is something that not all blockchains offer.. For example, Polygon, a blockchain known for its low fees, has a centralized system that has unlinked security vulnerabilities that the community has flagged.
A self-perceived web 3.0 maximalist and meme coin minimalist, Evan warns: “No one yet provides a decentralized network.” And he adds that those who develop applications on other alternative blockchains, “exchange decentralization for a little bit (for now) of less fees.” Something that, although it seems to be an advantage, can end up being a security vulnerability.
From Argentina, Pablo Sabbatella, the founder of the cryptocurrency academy DefyEducation, reveals to us a look that coincides with the line of Evan Van Ness. According to him, the main reason why Ethereum continues to be the most used network, despite the fact that there are other cheaper ones, is because of its decentralization, which provides greater security.
The Argentine specialist explains that alternative networks to Ethereum are cheaper and sometimes much faster as they are less decentralized, since it counts fewer nodes. This lowers transaction costs and increases their speed, but makes them more insecure.
As an example, he points out that there are more than 10,000 Ethereum nodes around the world. By comparison, Binance Smart Chain, which offers much lower fees, currently owns just 21 nodes. That makes Ethereum more decentralized and more secure compared to others.
Pablo Sabbatella details: “the more decentralized, that is, the more nodes a network has, the much safer it is”. This is because centralization makes it easier to be attacked, censored or have assets confiscated. Therefore, he maintains that all assets with the highest value are developed on Ethereum.
The specialist from Argentina also points out that Ethereum promises changes this year that will make its transactions cheaper and faster, without losing decentralization and security. Or at least that is what the developer community is looking for. This is something that could reinforce and even increase its dominance if other networks do not improve.
Ethereum has the largest community of developers
Another factor that makes Ethereum remain the number 1 blockchain is that it has the largest community of developers. In fact, even greater than that of Bitcoin, which is the network where the cryptocurrency with the largest market capitalization is developed. This is partly because, in Ethereum, unlike Bitcoin, thanks to the Solidity programming language, it is much easier to create smart contracts and, therefore, the development of decentralized applications.
A study by Electric Capital, a cryptocurrency venture investment firm, identified that More than 4,000 developers per month have been actively working on Ethereum over the last year.
Compared to that, in the same period of time, Bitcoin has had 680 developers. Although they are not comparable blockchains, this data is an indicator of the dimension of Ethereum compared to other similar networks that allow the development of smart contracts.
According to Pablo Sabbatella, the reason why most developers in the cryptocurrency ecosystem work on Ethereum is because of its decentralization, security, and scalability. He considers that, when compared to other alternatives that allow the development of dApps, it is the one with the best standing today and the one with the best future.
This is something that can be noticed in the size of the events that are mounted to promote the growth of the ecosystem. An example of this is the ETHDenver convention that attracted a crowd of Ethereum stakeholders.
Developers and industry members from around the world attended ETHDenver, which was held in Denver, Colorado in the United States. In fact, the two specialists consulted by CriptoNoticias for this note were present there, Evan Van Ness, who traveled from Texas, and Pablo Sabbatella from Buenos Aires.
The interest that exists in the development of the network is also framed in the popularity of different industry programmers in their social networks. Examples of this are Vitalik Buterin, the co-founder of Ethereum, with more than 3 million followers on Twitter, and others with hundreds of thousands of followers, such as Gavin Wood and Joseph Lubin.
Ethereum is older in the dApps market
Ethereum is recognized as the first decentralized application network. According to Pablo Sabbatella, all the others that were emerging are a copy. In fact, that is why they are often called “Ethereum killers” or “Ethereum killers”. Because they promised to be better than this network.
Since Ethereum emerged in 2015, it has managed to develop some of the decentralized projects with the longest history and market volume on its network.. An example of this is OpenSea, one of the most popular NFT trading platforms on the market since its foundation in 2017.
Probably the most expensive and recognized NFT collections on the market are traded at OpenSea. One of the most famous and expensive NFT collections in history that it owns is that of CryptoPunks, which was created in the same year of its foundation and has a traded volume of more than USD 2 billion in ETH.
Age, in short, is one of the factors that make Ethereum stand out. This is not only because has more years of development (2015) compared to other younger blockchainssuch as Terra that was born in 2018 or Binance Smart Chain in 2020.
Along with this, being the first blockchain with smart contracts, it has managed to capture the current boom in NFTs, decentralized finance (DeFi) and games. play-to-earn. These industries have managed to reach their all-time highs over the last year, something that is reflected in the total locked volume of Ethereum indicated at the beginning of the article.
The Ethereum cryptocurrency is the largest in the dApps market
Ether (ETH), the Ethereum cryptocurrency, is the most valued in the market and with the largest capitalization, after bitcoin (BTC). This makes it the most powerful in relation to other similar blockchains, so different users might feel safer holding ETH than any other Ethereum-like cryptocurrency.
According CoinMarketCap, at the time of closing this note, the value of ETH is more than USD 2,614 with a market capitalization of USD 313 billion. The next most traded cryptocurrency on the market is BNB, which is worth USD 369, that is, seven times less than ETH.
Ether has managed to triple its value from January 2021 to February 2022. This rise may have motivated different organizations to choose Ethereum to develop their decentralized applications. Likewise, the rise in its price may be the reason why inexperienced users in cryptocurrencies have opted for Ethereum when wanting to enter the world of dApps.
An example of this is that, during the last year, what is known in the ecosystem as “NFT-mania” has been unleashed. Selling tokenized collectibles for millions of dollars in ETH. There are those who even trade NFTs, such as the youtuber Luisito Comunica. This in order to make a profit profit by selling at a higher price than they bought it for.
Although it is worth clarifying that the use of ether is not only reflected in network applications. Its consumption has grown as direct investment. In fact, according to the Glassnode explorer, currently there are more than 75 million ETH addresses and about 40% are individual holders.
Ethereum wins for security, development and value of its cryptocurrency
In conclusion, what makes Ethereum continue to be the leader in the dApps market is a unique combination of factors that are only in its network and not in another; It is the blockchain in the dApps industry that has the greatest track record, development and security against possible attacks.
Because of this, since its inception seven years ago, it has formed the largest and most active community of developers in the ecosystem in a decentralized manner. all this rbacked by the second most valuable cryptocurrency in the market.
This mix of factors makes Ethereum remain the leader in the decentralized applications market today and probably will do so for a long time. Especially if the boom in dApps continues and the network improves its transaction fees.
