Ethereum 2.0’s first upgrade will happen this month — a step closer to denting the competitive advantage of ‘Ethereum Killers’
Altair hard fork, the first upgrade for Ethereum 2.0, is slated for October 27.
- It is the first step towards bringing the proof-of-stake (PoS) to the main Ethereum platform.
- PoS is the primary competitive advantage that 'Ethereum Killers' like Solana, Cardano and Avalanche have over the Ethereum blockchain.
Altair, Ethereum 2.0’s first hard fork, is expected to come into effect by the end of the month — just before Halloween kicks off. It is the first step towards getting developers and coders ready for the ‘Merge’ — the point where the original proof-of-work Ethereum blockchain will transition to Ethereum 2.0’s proof-of-stake consensus mechanism.
Alpha leak: Don't buy any more mining hardware #ethereum #mergeLeft: Geth running post-mergeTop Right: Lighthous… https://t.co/4AfLlGqAVY— MariusVanDerWijden (@vdWijden) 1633407998000
The move is expected to reduce Ethereum’s power consumption by 99.9%. While this is good news for Ethereum and its native token Ether (ETH), which is the second largest cryptocurrency globally by market cap, it’s not good news for the likes of Solana, Cardano, Avalanche and others.
These players are often dubbed to be ‘Ethereum Killers’ because they claim to do the same things Ethereum can, but better. In the world of crypto that means cheaper and faster. However, once Ethereum 2.0 kicks in, that may no longer be the case, denting their competitive advantage.
Why is Ethereum 2.0 a threat to ‘Ethereum Killers’?
Ethereum was first on the crypto scene with smart contracts — agreements that get executed automatically whenever the prerequisite terms and conditions are met.
Ethereum’s native token, Ether (ETH), is the second largest cryptocurrency globally by market cap. This means that its adoption — popularity and usage among users — is second only to Bitcoin. All in all, it has the first mover advantage.
Among three aspects of the blockchain ‘trilemma’ — decentralised, scalability and security — Ethereum already hits two, but scalability that thus far eluded the platform. Simply put, if there are too many users on the blockchain, it gets increasingly expensive to buy and sell things.
This was seen during Time Magazine’s non-fungible token (NFT) launch where some users ended up paying 30 times the original price of the NFT.
Cardano, Solana, Avalanche and others claim to address the issue with PoS. But, if Ethereum moves to PoS as well — which it is — what will set the other blockchains apart?
Without PoS as a competitive advantage over Ethereum, they’re unlikely to have as many developers flock to their respective blockchains — another facet where Ethereum is miles ahead. Ethereum has thousands of developers. Most others only have a couple of hundred.
The only thing that is left to set them apart is the target market. For example, Ethereum is mostly focused on the West. Cardano and Solana, on the other hand, are going after the developing world.
The question remains whether there’s enough ground for everyone to share because by 2022, they will all be on the same footing.
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