Decentralized Finance (DFI) is exploding. The amount of Capital locked In DFI, an incomplete yet effective benefit of the crack, hit an all-time high of 35 35 billion recently.
Today, Etherium is DFI’s dominant network in all important metrics of capital flow, locked capital, number of projects and developers.
Alex is the co-founder Jabo, A platform that enables fintechs and financial services companies to easily integrate cryptocurrency accounts into their applications.
The explosive growth of DFI has already started a deadly battle between the “Ethereum-Killers”, among smart contract platforms for emerging departmental partnerships.
Tushar Joyan, a partner at crypto venture firm Multicoin Capital, recently took to Twitter to question Ethereum’s DFI dominance:
Jain’s vision has been captured by many smart investors and can be summarized as follows: Eventually higher performance, better designed, less expensive networks will start eating into Ethereum’s DFI market share.
In fact, investors have taken billions upon billions of competitive smart contract platforms in support of this perfect thesis.
Yet, despite the huge amount of capital launched and deployed by many competing platforms in their efforts, Etherium’s network impact and emptiness are as unnecessarily strong as ever. How is this possible?
This is possible because etherium is strong Indomitable property Which are incredibly difficult to reproduce and compete with.
This is not a new dynamic – indomitable domination has long been observed and has affected conventional markets and firms as well.
Coca-Cola, Google and … Etherium?
You can generally divide resources into two categories: real and indomitable.
Obvious resources are physical in nature – things like money, equipment and servers. For computer networks, a clear asset can include how much computational power can be supplied or how quickly a query can be run – given the physical nature of the gross resources, they are quite easy to quantify and measure based on the underlying physical characteristics of the network.
In contrast, indomitable resources do not exist in physical form – such as intellectual property, brand recognition, and trust. Copying indomitable resources can also be incredibly difficult because their creation often depends on something more complex, such as the thinking of the human brain.
Investors have long known that successful companies have strong indomitable qualities that enable them to achieve external standards and remain highly competitive for long periods of time.
Consider a company like Coca-Cola. Imagine that you created a Cola that tasted better than Coke (“higher performance”) and provided enough capital to build a better global distribution network to compete with Coca-Cola (“more scalable” and “less expensive”).
Will this enable you to force most existing and new cola drinkers to switch off Coke?
Coca-Cola’s obvious assets – the raw materials that make up Coke’s flavor, packaging and distribution – not only secure the company’s influential market position. Coke is influential today because of its indomitable wealth: its universal brand awareness, customer loyalty and the way it makes people feel. These are incredibly hard to reproduce.
Still, Coke is a consumer brand. What will happen to technology? We find the same trend there.
Google is a clear example of indomitable dominance in a technology market. Google is widely regarded as the best technology like Coke (part of its brand and thus invisible), its brand is so strong that it became a generic term (“Google Brick”).
Today, more than 20 years after Google was founded, competing search engines still lag behind Google’s 85% + market share. Why? Brands, untrustworthy assets with faith And the amount of existing searches, Which together form part of the childhood that enables Google to maintain a consistently higher resource for a longer period of time.
What about open source networks? Are the same rules applied?
In open source networks, there are only a handful of resources to work with. There is no patent or intellectual property that makes one network better than another. All networks compete on a wide, fully open plane, viewable and replicable.
At first glance it may seem like it makes real assets more valuable like network speed, computing power or easy availability of capital.
But it is the complete opposite. Explicit resources are reproduced more easily in open source software than anywhere else. As with conventional business, indomitable people are the king of open source.
Competitive networks can point quickly Clear Weaknesses in Ethereum’s network: high transaction fees (not cheap), lack of scalability (not fast) and even easily fun smart deals (not secure).
However, they fail to fully realize that the real fear behind Ethereum’s immeasurable indomitable wealth is its dominance:
- A broad, rapidly expanding interconnection of developing energy (evidence of work), capital, resources and projects (similar to Google’s existing search volume fears)
- Bitcoin (leader of the division) and then just a cryptocurrency brand The Influential brand in DFI where Ethereum is much more and department leader
- A fan loyal community that includes the most influential network of developers and projects in the entire crypto industry.
Basically an attack on a clear basis – “advanced technology” and more resources – will make Ethereum “better” than “Coke” or “better search results” than Coke or Google, from its dominant position. At this stage the indomitable algae is just too wide, giving Ethereum a free range to continue building free infrastructure.
Many well-capitalized, super-talented and successful teams have built a network that has launched (yet) fought to curb Ethereum’s DFI dominance. What is at stake in most of these efforts is the assumption that the strategy to achieve higher clear results in the same segment owned by Ethereum will be the winning strategy.
What will happen to new users?
Jain’s remarks are important “New DFI users, ”indicates that Etherium’s dominance will not last as Defy grows, and there are many new participants.
Still, we don’t need to look beyond Bitcoin to see the opposite.
Similar to Ethereum and for twice as long, Bitcoin has faced and eventually competed for the throne of the influential, decentralized, store-of-value network. Similar to Etherium, the perceived limitations of the Bitcoin network have been constantly attacked, and it is also very slow and not scalable, including
Yet despite the seemingly insignificant number of repetitions, every bitcoin rival has failed to produce an invisible void that is significant in terms of brand, awareness, belief or acceptance. Instead of confusion, Bitcoin has dominated the market with a market cap of more than 60%. The “digital gold” of the Bitcoin brand has become so powerful that not even gold Can escape The indomitable gravity of Bitcoin.
After twelve years and thousands of competitors, Bitcoin continues to transform into an external part of the growing crypto user.
Ethereum is the only network with similar network effects to Brit, loyal follower and Bitcoin. It has got them by creating completely new divisions – smart deals and DFI – that do not directly compete with Bitcoin. If Bitcoin and Internet businesses have any clues with the effects of a strong, resilient network, we’re moving forward. More dominance For etherium, no less, driven by growing uninterrupted algae.
So what do competing technologists do? Building closed? Stop investing?
Technicians should continue building and investing in new departments where the authenticity of their products and philosophy will attract not only users, but also loyal followers.