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DappRadar—Redefining Accuracy and Transparency in the State of Dapps

Skirmantas Januskas is the CEO and founder of DappRadar.He joined the crypto and decentralized applications (Dapps) space in late 2017 and found his interest peaked by the enthusiasm and kindness of those he interacted with in the community. He founded DappRadar in February 2018, a website that lists the best Ethereum Dapps and ranks them by DAU (Daily Active Users) showing the authentic acceptance and usability of Dapps.

Although Bitcoin kicked off the entire ecosystem of blockchain, it was Ethereum that first unlocked aspects of its true potential by allowing developers all over the world to create decentralized applications (Dapps) on their blockchain platform. Through Ethereum, developers could code smart contracts that serve as the blueprint for Dapps. Other blockchain protocols joined in, the two most major Dapp enabler alternatives to Ethereum are TRON and EOS and there are currently over 3000 Dapps running on blockchain protocols.

So which Dapps are the most used, which protocols work best? Which networks are able to scale and support your business’ decentralized application? To answer these questions is a slew of Dapp Data sites, but one site seems to rise above the others and is indeed redefining the metrics for the space—DappRadar.

Redefining the Metrics

According to Januskas, the vision for DappRadar is to be a trusted starting point for Dapp discovery and act as a distribution channel for Dapp developers that are looking to reach new consumers. DappRadar has already built a leadership position as the most trusted Dapp platform. He said, “Recent product upgrades have seen us present the most accurate data on EOS with our unique token tracking, this will be rolled out to Ethereum in November and will potentially reveal billions of dollars of undiscovered volume and completely change the way Dapp industry data is evaluated and reported. We will play a leading role in growing the market for Dapps through our commitment to working closely with Dapp developers and providing reliable data.”

DappRadar has tracked the daily metrics of over 2,700 Dapps and 12,000 smart contracts across the Ethereum, EOS and TRON blockchains since February 2018. Januskas added, “Unlike our competitors, we have a public, robust attitude in terms of filtering out what we consider ‘fake’ or ‘manipulated’ traffic, notably traffic generated by bots and we are working hard this year to provide even more product features to allow us to present the most accurate data. So how do we set ourselves apart – We focus on our product and delivering the most accurate data.”

Identifying and Combating Manipulated Data

As in any traditional industry, there will always be incentives for companies to inflate their Dapps’ performance. Trying to game the system is inherent in all sectors, and despite the relative openness of blockchain data, it continues to happen in the decentralized space.

Currently, Januskas and his team see Dapp data being actively and passively manipulated in three main ways:

Activity is actively manipulated by a Dapp boosting service to ensure Dapps remain high in rankings. This is typically driven by the developer themselves.
Dapps contain incentives that encourage players to create multiple wallets and accumulate rewards and tokens. This may be active manipulation by the developer or a byproduct of design.
The trading of Dapp tokens on exchanges is included in overall traffic data.

He said, “DappRadar has started filtering its results to remove such activity and will continue to monitor future developments, and take swift action when required to ensure our data is as accurate as possible. This may include marking Dapps we believe are engaging in manipulative and deceptive activities, potentially even blocking or delisting Dapps from our site that continue to do so.”

On spotting fake volume in Dapps, Januskas said, “We look at the anti-money laundering regulators and take note of what CoinMarketCap is doing—we are all detecting these patterns but unfortunately I cannot disclose the actual fake cases and the algorithm pattern that we have identified. We do analyze each account and each wallet to monitor the flow of money.” He reiterated, “We want our industry to be as transparent and truthful as possible so the rewards of what we are sure will be a vibrant and profitable ecosystem go to the best products, not those that are best at gaming the system.”

Ethereum vs EOS vs Tron

DappRadar recently added full token tracking for EOS Dapps which has reportedly uncovered that the EOS Dapp ecosystem may be undervalued by 1 billion dollars—as other sites typically do not track the full token.

When asked how important this new tracking revelation was for the Dapp market, Januskas said, “It’s not only important, it’s completely necessary if you want to claim to be providing the most reliable and accurate data. Our competitors do not track this way simply because they cannot until they do the background work to make it possible. More comprehensive token tracking is key to increasing the transparency of value creation in the Dapp ecosystem, especially for decentralized exchanges. For instance, Newdex (DEX) based on the EOS blockchain has seen the addition of around $5 million value in non-native tokens within the first 7 days of launch on top of their $21 million value in native EOS tokens.”

Source: DappRadar – Full Token Tracking

Specifically, with Ethereum token tracking, Januskas said, “The most challenging aspect is getting the pricing right. If you visited a number of exchanges you see ERC-20 tokens being priced differently, so this is problematic and also presents kind of an ideological challenge—which exchanges can be trusted and where can users get the price?”

The Dapp of 2019? How MakerDAO Took Charge of the DeFi Field

The MakerDao project is the contemporary success story for decentralized finance (DeFi). The project went live in December 2017, with DAI as the USD stablecoin and MKR functioning as the governance token. In the world of decentralized finance, MakerDAO is by far the most popular application running on Ethereum and has been steadily increasing traction since its launch. After only a year and a half into production, MakerDao reached its all-time high market cap of $97M on July 9, 2019.

In part one of our interview with Gustav Arentoft, Business Development, Dai Speaker, MakerDAO, he offers Blockchain.News insight into the home-grown success of his organizations in terms of transparency, governance and the interesting use case of Maker in Spotify.

Steady growth of DAI despite dropping market dominance

According to DeFi Pulse, the total ether deposited in MakerDao represents just above 50 percent of the total value locked into DeFi protocols. While still dominant it marks a significant decrease from the 90 percent recorded at the start of the year. While the percentage has fallen, Arentoft believes, “It really depends on what you look at as dominating factors. Currently, the rankings are defined by the number of crypto assets locked into a DeFi protocol. We were one of the first projects that you could actually lock up Ethereum to print DAI against so of course, our market dominance was much higher previously.” Commenting on the increased competition Arentoft said, “Fortunately some of these new players have come along, like Compound which has had a very strong performance over the last 12 months. There are also different protocols like Uniswap, but the incredible thing is these new protocols—they take DAI and actually one of their primary use cases in their system and protocols is using Dai. For example, Compound dominates the holding of DAI with 12.6M. So we may have lost market cap but that market cap went into other protocols that utilize Dai in efficient ways and even open up some very strong arbitrage opportunities.”

Exhibit 1: DAI Locked in DeFi 2019

Source: DeFi Pulse

Due to the nature of the DeFi ecosystem, ultimately Maker’s lost market cap is benefiting the end consumers as the various protocols are interoperable (see Exhibit 1). Arentoft said, “The protocols continue to leverage each other’s technology and awesome products and services are being created for end-users, so we are not overly concerned about the perceived loss in dominance because Dai will still be the stable value in these systems.” He concluded, “If you look at us from just a crypto perspective, we might continue to appear shoulder to shoulder against these very competitive and good products but if you look from the outside, I believe we will be one of the first projects to bring legacy world collateral into the smart contract-based systems.”

Bringing liquidity to Spotify’s artists

Turning to use cases and partnerships, Arentoft discussed a Maker’s collaboration with Paperchain—an extremely efficient data analytics provider which leverages data which can be publicly viewed on platforms such as Spotify.

Arentoft said, “The problem that we’re solving is that currently the artists streamed on Spotify have to wait a long time before they actually receive their royalties and payments, so we’ve created an extremely efficient and accurate data analytics tool to basically predict the amount owed down to a 1% difference. This creates an alternative asset that traditional institutions are not used to serving, however, it is an asset that’s actually relatively easy to price.”

On the Spotify project, Maker has been working with an open-source framework from Centrifuge, Arentoft said, ‘’We basically can take these individual royalties which are converted into NFTs and then you can actually create a standardized version of the collateral, which we didn’t aim to use in multi-collateral Dai.” He explained, “That basically means that U.S. and Spotify artists can predict their future income. They can leverage the blockchain and the MakerDao protocol to actually gain an advance payment on the royalties that the artist will be getting. It is a new way of bringing liquidity to artists basically.”

Maker’s Transparency and Decentralized Governance

Maker’s enjoys an unmatched degree of popularity among the DeFi community. Arentoft believes that this can be attributed to the very high degree of transparency within the organization. He said, “I think we have one of the only projects that has verifiable revenue directly on the blockchain, enhancing the transparency of fees coming to us and the overall movement of capital in the blockchain. If you want to check it out, you can go to the website called Makerburn.com which in real-time and shows everything going through the system.”

On Maker’s governance as a decentralized autonomous organization, Arentoft commented, “We have been live with the ability to execute on-chain governance since 2017. In the future, governance is going to be a little bit more tricky because there’ll be a lot more different kinds of decisions to make regarding the structure.” He continued, “But the governance of Maker was something which started out in many ways as an experiment and now with a proven track record, we have shown that this is something that actually works.”

MakerDAO’s Popularity: Behind the scenes

Arentoft believes that there are many different factors that have contributed to the success of Maker’s decentralized autonomous governance. He elaborated, “We have had very strong support within the Ethereum community and I think we have one of the first strong use cases has managed to manifest itself, which in turn has created a sphere of people who wants to participate.”

Maker has also been very open and transparent about issues within their protocol such as the common pain point of scalability but has continued to engage their community throughout the process of addressing these issues. Arentoft couples this enhanced transparency with Maker’s strategy to attach themselves to projects that have the greatest growth potential as further indications of the economic communities’ interest and patronage. Arentoft divulged, “We truly project that we can go out and change the lives of everyday people right, at tremendous scale. I think people want to join that movement and the future prospect and at the same time, the Maker project has drawn the attention of the people who tend to hang around in macroeconomics circles. We have some strong followers, both from central banks and prestigious academic communities so I think there’s a lot of different elements that when combined make Maker a pretty interesting and quite outstanding project.”

Stay tuned for Part 2 and 3 of MakerDAO’s interview.

DappRadar—What is the Dapp of 2019?

Skirmantas Januskas is the CEO and founder of DappRadar. He joined the crypto and decentralized applications (Dapps) space in late 2017 and found his interest peaked by the enthusiasm and kindness of those he interacted with in the community. He founded DappRadar in February 2018, a website that lists the most popular and utilized Dapps and ranks them by DAU (Daily Active Users) showing the authentic acceptance and usability of Dapps.

In the second part of our exclusive interview with Januskas, we discuss Ethereum’s transition to proof-of-stake, the growing Dapp ecosystem and the DeFi revolution instigated by MakerDao.

Staking and Scaling in the Dapp ecosystem

Ethereum has served as the main network for Dapps to be built upon, but since its creation, it has run on a proof-of-work consensus algorithm. With Ethereum announcing Eth2.0 with the transition to Proof-of-Stake (PoS), we asked Januskas what impact staking would have on transforming the current Dapp ecosystem. He said, “Many of the blockchains we already track such as EOS, TRON and Loom Network’s Basechain, use a Proof-of-Stake consensus so that part won’t be anything new. What may be more interesting with staking on Ethereum is how this could be integrated as a new feature into existing Dapps, or indeed create opportunities for new Dapps, especially in the DeFi category.”

Scalability of Dapps has been a well-recorded pain-point of blockchain adoption. Januskas acknowledged this point and commented, “Compared to centralized architectures, blockchains will always struggle in a relative sense with scalability. We’ve seen that regularly on Ethereum since CryptoKitties launched in late 2017 and EOS is currently struggling with similar issues because of the popularity of a single new Dapp which is incentivizing people to use their tokens in a new way. If you wanted to be philosophical about it, you could argue issues with scalability actually demonstrate the popularity of a particular blockchain. Or another analogy: building more roads encourages more people to buy cars and drive!”

State of DeFi

Decentralized finance (DeFi) has been making waves over the last several months following the surge in platforms and products offering DeFi services and applications. Januskas is particularly pleased with this development, he said, “Yes, the explosion in DeFi Dapps on Ethereum is proof Dapps can offer great utility and do so in a manner that is very hard to copy in the centralized software space. The major driver of this is MakerDAO’s DAI stablecoin, which enables developers to build increasingly complex products on top of a trusted layer. This level of composability is at the heart of DeFi and allows developers to come up with ever more sophisticated solutions to niche problems.”

Despite his positivity, Januskas offered a few words of caution for the DeFi space, he said, “Although a lot of value is being put into these new financial instruments, these products are no way near accessible to the mass market. And as all the developers point out, everything is in beta. It will be interesting to see the market reaction should any serious bugs or exploits emerge.”

Dapp Growth and Dapp of 2019

While DeFi has emerged as the most significant vector for Dapp growth in 2019, the game sector hasn’t been slacking. 2019 has seen the launch of new titles, some of which have quickly grown to become the most popular Dapps in terms of active wallets. In addition, some older games remain in contention for the top spot. Januskas said, “The result is that as we enter Q4, at least four titles are sustaining more than 2,000 daily active wallets. The blockchain game sector remains incredibly buoyant. The current games are a small subset of the total projects in various stages of development, with 2020 shaping up to be a very important period for this nascent industry.”

If forced to choose a “Dapp of the year” in 2019, Januskas was quick to comment, “There’s no question that MakerDAO has been the most impactful Dapp in 2019 in terms of number of users and token volumes, plus the opportunities it’s created for the entire DeFi ecosystem.” He added, “I also have a soft spot for Uniswap, which makes a complex thing – creating a crypto trading platform – very simple, also enabling users to provide its underlying liquidity.”

Dapps Should Focus on Users

As one of the main people aiming to grow the Dapp ecosystem, Januskas advised, “Dapp developers need to keep the user at the heart of everything they do. In its infancy the internet was similar. Programmers only cared about getting a site live and having it provide valuable info. The aesthetic and user experience were not even on their radar and as such it took quite a long time for the internet to become truly appealing to the masses, a transition that really happened once user experience and aesthetic became paramount.”

According to Januskas, Dapp developers have to make their products as accessible as possible and user-friendly to stand the best chance of discovery and retention. He said, “Providing users with understandable instructions and not assuming they are as knowledgeable as the developers is a good start, gameplay walkthroughs and advice for newbies on how to actually enter a Dapp is paramount to the long term success of Dapps in our opinion.”

DappRadar in 2020?

Januskas ended our interview by sharing DappRadar’s plans for 2020. He said, “We are using the $2.3M investment led by Naspers Ventures and Blockchain Ventures secured in September 2019 primarily for R&D, developing new functionality to help the business expand its services and reach the next stage in its growth. By the end of 2019, we aim to be the most accurate and reliable Dapp data source on earth.” He added, “This process is already well underway, alongside a host of UX updates. Moving into Q1 2020 we have some very exciting developer and user product updates and further token tracking across TRON and Ethereum, integration of additional protocols and the release of a proprietary, robust artificial traffic filter as part of our ‘Clean Data Mission’ for 2020. We see lots of evidence that demonstrates the long-term potential of the Dapp industry and are building a business that maximizes that into the future.”

How Dapps Will Become Superior Over Apps

Blockchain technology is continuously being touted because of its innovation of creating decentralized systems that have instigated benefits, such as traceability, transparency, and immutability, among others.

As a result, blockchain has made the creation of Dapps (Decentralized Applications) a reality. The benefits rendered by Dapps considerably out-weigh those presented by Apps (Applications).

No more Undercover Work

At times the notion that the big brother is watching (surveillance) is intimidating because privacy is jeopardized.

Apps are developed in such a way that information is stored in a centralized system, and this prompts the notion of big brother watching because a user’s information can be easily accessed.

Nevertheless, Dapps run on decentralized networks, such as EOS or Ethereum, and this renders privacy and immutability. As a result, once Dapps are in operation, they are deemed censorship-resistant, and this eradicates any undercover work or the idea of the big brother watching.

Data Hacks are Averted

Access to personal data is an issue of concern to many users. Hackers have been wreaking havoc as they are continuously stealing information from different networks for egocentric motives. Apps have not been spared based on their centralized systems.

Based on their decentralized nature, developers can customize Dapps in such a way that access to personal data is limited. Additionally, public blockchains, such as Ethereum, have been cryptographed to open-source and secure their code, and many independent developers oversee this process. As a result, Dapps are less vulnerable to breaches and hacks compared to Apps that are engineered by centralized networks.

New Payment Methods

DApps support cryptocurrency payments, such as Bitcoin and tokens, and this is advantageous to users because they can be easily remunerated, for instance, once they win an eGame.

You can also be paid in small amounts of cryptocurrency upon your friend’s purchasing recommendations for affiliate links or advertising.

Bottom Line

Dapps are being touted for their decentralized network as they will handle privacy and data breach issues. Moreover, they seek to present transparency about their operations.

As a result, the decentralized system used by Dapps will give them a competitive edge over Apps because of the immutability offered. Nevertheless, Dapp developers and blockchain creators still need to make Dapps fast and simple to use, as is the case with Apps.

Image via Shutterstock

MakerDAO, on the Significance of Multi-Collateral Dai and Dai Savings Rate

Exclusive interview with Gustav Arentoft: Part 2 (Link: Part 1)

MakerDao is the protocol behind Dai, the world’s first decentralized stablecoin and the contemporary success story for decentralized finance (DeFi). The project went live in December 2017, with Dai as the USD stablecoin and Maker functioning as the governance token. In the world of decentralized finance, MakerDao is by far the most popular DeFi protocol running on the Ethereum network and has been steadily increasing traction since its launch. After only a year and a half into production, MakerDao reached its all-time high market cap of $97M on July 9, 2019.

In part two of our interview with Gustave Arentoft, Business Development, Dai Speaker, MakerDAO: he shared with us the significance of the launch of multi-collateral DAI and Dai Savings Rate (DSR), as well as his favourite Dapps which integrates DSR.

The Future of Digital Cash Multi-Collateral Dai (MCD) represents the future of digital cash, with a new Dai Savings Rate feature and the activation of a smart contract that paves the way for new collateral assets to back Dai. Maker is touting its arrival as a significant step towards the vision of creating a decentralized platform to help level the economic playing field for people around the world.

MCD was activated on the MakerDAO system on Nov. 18. MCD, as its name states, will enable users to create Dai stablecoins backed by multiple collateral types. The initial collaterals for MCD will be ether and basic attention tokens. The introduction of MCD also allows for today’s launch of the Dai Savings Rate (DSR), a feature that makes it possible to earn savings simply by holding Dai.

Arentoft commented on the launch saying, “It’s very similar to having a US dollar-denominated savings account. It works as a form of staking, the savings accounts will take some part of the profits from the system and distribute them back to the users on the system. One of the benefits of having a decentralized system is that we don’t have to abide by traditional monetary policy but can instead focus a lot more on helping people.”

The Dai savings feature could not only offer a shield to users living in regions where it becomes necessary to guard oneself against rampant currency inflation and poor government monetary policies, but it will also carry an interest rate which will potentially increase the users’ wealth. Reflecting on a personal note, Arentoft said, “I lived in Argentina for a year and a half before joining Maker, so I really have firsthand experience living in the oblivion of monetary uncertainty. Trust me, a Dai savings account would have been a gift from heaven during that period to protect myself and my finances, so I know that this product will really be capable of creating a very positive impact in communities that are often facing fiscal uncertainty.”

MCD Functionality and the Vault

In order to support MCD functionality and its features, such as the DSR and new collateral types, the core Maker Protocol smart contracts were rewritten. Therefore, users and partners interacting with Sai must upgrade their existing Sai tokens to Multi-Collateral Dai tokens (Dai) and Vaults (formerly CDPs) to the new system. Additionally, companies or projects integrated with Sai and Vaults must update their codebases to point to the new smart contracts and support the updated functions.

Arentoft offered some clarification on the change in terminology, “It was felt that some of these words weren’t really accurately describing what they really represented and bore too many similarities to traditional financial instruments. Therefore, a decision was made to go out and create some more informative terms—the vault, for instance, just represents the ability to hold collateral in the system, and the visual trigger represents how safe it is to actually hold assets and collateral in our system.”

Migration webpage of MCDSource: MakerDAO website

DSR Dapps

Prior to the launch of the MCD, the team at Maker rigorously tested the smart-contracts to uncover and integration issues and to ensure the decentralized applications (Dapps) featuring Dai on the Maker protocol would support MCD functionality.

Arentoft discussed some of his favourite Dapps, he said, “My personal favorite is Argent—it is a very easy to use smart contract based wallet that will have the DSR on launch as well as CDPs.” He added, “Of course there is Wirex, one of the biggest debit card providers with three million registered users, obviously it will greatly appeal to our users if you can keep Dai on a debit card while earning savings interest, which their product will. The key to these products is easy user accessibility and functionality as the world of decentralized finance can be a daunting place to the uninitiated.”

The Future is What We MAKER

Following the launch of the MCD, Maker will still have plenty of projects on the horizon. Arentoft shared, “We’re going to make a few enhancements to the infrastructure as well as build a token representation of the DSR. We also want to take a more focused and proactive approach with our partners and offer more in terms of support and resources.” Concluding our interview, he said, “In general, on the partnership side of things, we’ve already been pretty successful. This year, we’ve scaled from just 100 projects to 400 projects that use Dai in one form or another—we would like to continue to scale up. We don’t have anything as major as the MCD or DSR coming out but in fairness these are probably two of the biggest innovations ever in cryptocurrency so we can’t be expected to change the game every year. But there’s still a lot of exciting things to come so definitely stay tuned.

Stay tuned on Part 3 of MakerDAO’s interview, on staying compliant over 400 global partnerships!

The Top Dapps to Consider Using in 2020

Dapps have brought a significant change in the field of blockchain technology. They are a new type of software applications, which does not undergo downtime, and cannot be shut down by anybody, and are not owned by a central authority. They are open-source software, which uses smart contracts to run transactions on a blockchain. Decentralized applications are making inroads in various fields like gambling, technology, education, finance, and other domains.

MakerDao

MakerDao is a decentralized credit service that runs on the Ethereum blockchain platform. Maker consists of community governance, collateral loans, and decentralized stablecoin (Dai).

Digital assets like Ether and Bitcoin are highly volatile and cannot be used as a day-to-day currency. The Dai cryptocurrency is stablecoin whose value is attached to the US dollar.

Stablecoins such as Dai is necessary for realizing the entire potential of blockchain. Dai strengthens financial services in the cryptocurrency world with stable prices against fiat currencies.

Anybody can use MakerDAO to open a CDP (collateralized debt position), lock in Ethereum as collateral, and generate Dai as a debt against that collateral.

MetaMask

MetaMask is a type of bridge, which allows users to run Ethereum Dapps directly in the browser without running a full Ethereum node. With its secure identity wall, MetaMask provides users with a platform to manage their identities on various sites and initiate transactions in the blockchain. Any user can install the MetaMask add-on in Opera, Firefox, and Chrome.

LivePeer

LivePeer is a Dapp which was launched in 2017. Developers use it for adding on-demand or live videos for their projects. LivePeer’s main aim is to increase video streaming and minimize its scaling cost. The rising demand for live streaming amongst consumers for news and entertainment has led to LivePeer’s growth. LivePeer aims to reduce the price of transactions based on the use of crypto-economic incentive mechanisms.

Votechain

Votechain is a form of a decentralized voting system that runs on a blockchain network. The voting system aims to improve the voting procedure and reduce fraud during voting by implementing a hybrid of both digital and physical blockchain voting options.

The creators designed the app in connection with suspected voting fraud in 2018 Mexico’s elections. This application will offer users the facility to vote from their mobile phones.

MTonomy

MTonomy is a decentralized application that provides secure blockchain infrastructure to monetize, distribute, and license digital media content like books, music, and movies.

MTonomy provides rights and content management services for distributors, service providers, and content owners, including the leading cryptocurrency-based VOP application for consumers. In other words, MTonomy is a streaming platform for cryptocurrency users.

Ethlance

Ethlance is a kind of job market platform built entirely on a blockchain. Anybody can access it as its database is built on the Ethereum public blockchain network. The platform uses crypto for payments.

Ethlance doesn’t charge any fees, and the entire amount paid by the employers is passed to the freelancers. The only cost that participants have to bear is the gas for transacting on the network.

SpankChain

SpankChain is an adult entertainment platform powered by blockchain technology. It was built by using the concept of Ethereum.

The platform offers complete privacy by eliminating the need for third-party intermediaries through the use of smart contracts. The Dapp has been recognized as a revolutionary technological and economic platform for the adult industry.

Ethereum—The Whole Forking History

Ethereum is the second most recognizable name in the cryptocurrency and blockchain space, next to Bitcoin. Ethereum was created to overcome the limitations of Bitcoin, which is essentially just a system for decentralized money, and push the boundaries of blockchain technology and decentralization. Like Bitcoin, it is supported by a peer-to-peer node network, meaning that it is essentially a decentralized server run by a vast number of computers with no central administrator or intermediary.

Despite a common misinterpretation, Ethereum itself is the name of the network and not its currency. Nodes are rewarded in Ethereum’s native currency called Ether (ETH) and the cost of computation is calculated in Gas.

The Ethereum network was invented by Vitalik Buterin, a Russian-Canadian programming prodigy. In his whitepaper, which was released in 2013, he describes Ethereum as a, “blockchain-based decentralized mining network and software development platform rolled into one.”

Bitcoin is governed by an underlying software protocol, which is a very simplistic version of the smart contract, serving as predefined rules for its network. Ethereum basically extends the idea of Bitcoin’s contract protocol but is far more ambitious with the aim of facilitating the development of an entire ecosystem for open-ended decentralized applications (dApps) and smart contracts to build and run while removing the risk of third-party interference.

Prior to the Ethereum network being launched in 2015, anyone that wanted to create a blockchain-based application had to create their own blockchain platform from scratch. But with Ethereum, developers can leverage off the Ethereum infrastructure to create virtually any application imaginable. Lack of Scalability — Cryptokitties

Both Ethereum and Bitcoin platforms depend on a peer-to-peer network of nodes and both use mining incentives to enlist those nodes into their platform. A node simply refers to a single computer out of the network of thousands that supports the peer-to-peer network.

As a public blockchain, the Ethereum network aims to offer support to as many users as possible. However, Ethereum runs on the same Proof-of-Work protocol as Bitcoin meaning that computational power is needed, not only to produce new coins but to process transactions and to keep the entire ecosystem moving. The stress put on each node becomes more of an issue as the Ethereum network attempts to grow or scale. Scalability is simply a network’s capacity to grow in size and manage the increased demand. For the Ethereum blockchain network, each node contains the full transaction history and updated ledger for account balances and contracts. As new blocks of transactional information are created, all nodes must store and update which can cause severe issues with network speed.

While scalability is now a common pain point for blockchain developers, the issue was first exposed in the Ethereum Network in 2017 when a dApp for the creation of cryptographic virtual cats, Cryptokitties, became a viral success and clogged the entire network with more transactions than it could handle. The popularity of Cryptokitties saw the dApp make a jump from $1million in transactions to $3million in transactions over the space of a day and at the time made up 20% of all transactions on the network. Besides the networks slowing down drastically, another noticeable effect was also the increase in price of the transactions.

What’s a Fork?

As a road diverging towards different directions is known as a fork, so is this expression applied to blockchains. Ethereum, like Bitcoin, is open-source coded meaning that it can be accessed and modified by anyone if consensus is reached but is still enforced by a specific set of consensus rules that are applied to evaluate the validity of a new block of data. Modifying the open-source code without reaching complete consensus of the network will result in one of two types of forks in cryptocurrencies, a hard fork or a soft fork. As blockchain platforms are decentralized, a consensus of what data is held on the blockchain must be reconciled by all nodes on the network in order to keep a single blockchain intact.

Soft Fork—a modification to the consensus rules that is backward compatible with previous versions of the blockchain. Soft forks modify the blockchain and apply new rules but fundamentally still allow older versions of the blockchain to remain valid.

Hard Fork—a permanent split in the blockchain if consensus cannot be reached. A hard fork is a far more substantial issue as it will invalidate older versions of the blockchain.

Ethereum’s Four Stages

Stage One—Frontier

The Ethereum platform was originally designed only for developers and it only featured command-line interfaces. This pioneer stage of its development was known as ‘Frontier’—alluding to the wild and untamed environment and the huge potential of the Wild West. After some initial errors were fixed and the platform was adapted for end users, Ethereum launched ‘Homestead’—its first public version. Stage Two—Homestead Upgrade

The first planned Ethereum hard fork was the Homestead Upgrade which was executed on the network on May 14, 2016. The upgrade removed a point of centralization on the network called ‘canary contracts’, and introduced new code into Ethereum’s programming language—Solidity. In addition, the update also included the application ‘Mist’, an ETH wallet that in addition to storing ether, can be used to write smart contracts.

The Homestead upgrade was one of the earliest implementations of Ethereum Improvement Proposals (EIPs)—proposals put forward by the Ethereum community that are to be included in network upgrades. For a full list of Ethereum’s EIPs click here.

The Forking DAO IncidentWhile not a planned upgrade, it is impossible not to mention the DAO Incident of 2016. A group of developers were inspired by the decentralization of cryptocurrencies and conceived of the idea for a decentralized autonomous organization (DAO) which would leverage the Ethereum Network. The project attracted many of Ethereum’s earliest investors and by May 2016—14% of all the Ethereum tokens were being held up by the crowd-funding initiative. Despite warnings that vulnerabilities were being detected within the DAO code, the project went live at the end of May 2016. In June, the project became the subject of an attack that saw the forewarned vulnerabilities exploited and 3.6 million ether were effectively stolen. Members of the DAO and Ethereum community engaged in hot debate about what to do next. Hard forking would all the stolen ether to be reabsorbed back into the pool, but this decision would not achieve a consensus as many believed that the attack was a valid maneuver, although unethical, as it did not technically break the rules. The decision was made and the Ethereum blockchain made an unplanned hard fork. As the decision did not achieve full consensus, many users have continued to support the old chain which is now called Ethereum Classic.

Stage Three—Metropolis The next planned stage for the Ethereum network is known as Metropolis, which is also the current stage of development. Metropolis would be implemented in two stages—Byzantium and Constantinople. The main impetus behind Metropolis is to prepare the network to transition from the Proof-of-Work (PoW) method to the Proof-of-Stake (PoS) method of consensus. Currently Ethereum and Bitcoin both use PoW which leverages ‘mining’—where nodes must solve complex equations where the first one to reach the solution is awarded the cryptocurrency and block ownership. In PoS, the process is called ‘forging’, more of a random selection where a node’s chances of owning the next block are greatly boosted by the proportion of assets that they staked in the network.Mining has been criticized as making the rich richer as chances of solving the complex equations are greatly improved in PoW based on the computation power you can afford, leading many major organizations to set up mining pools. An individual miner is effectively blown out of the competition for blocks as they cannot afford to run the same amount of calculations as a billion dollar multi-national.

Byzantium Fork

Byzantium upgrade went live in October 2017 and introduced a total of nine EIPs to the system. This first upgrade has paved the path for the PoS method by restructuring the reward system for blockchain miners. The updates disincentivize mining on Ethereum’s blockchain by reducing the award for a single block from 5 Eth to 3 Eth. This update has also purportedly delayed Ethereum’s Ice Age —where mining will become so difficult that it will act as a catalyst for the network’s move to the PoS model—by up to 18 months.

The Byzantium update also made it compatible with cryptographic primitives, a function that provides cryptographic evidence of a transaction’s completion while keeping all participating parties anonymous—thus enhancing the privacy system and introducing a more autonomous flow of assets within the system. Constantinople Fork

The Constantinople upgrade went live on February 28, 2019, after being pushed from its original launch scheduled for the middle of January 2019. The delay was caused when an independent audit firm, called ChainSecurity, published a report highlighting how one of the five main upgrades could give hackers entry to steal assets. Clearly having learned from the DAO incident, developers delayed the launch opting to first investigate and resolve the security issue. Constantinople is made up of two stages, Petersburg (launched in February 2019) and Istanbul:The Petersburg stage centered around the “difficulty bomb” and introduced a total of five EIPs, four of which had very little impact as they were mainly enhancements and optimizations. One that did have a major impact was EIP 1234 which became known as the ‘thirdening’ and was an adjustment to block rewards. It was a hard-fork which saw the block rewards reduced from 3 ether to 2 ether, further deterring small miners by decreasing profits, as well as reducing inflation.Istanbul Fork ExecutedThe Istanbul hard fork is a system-wide upgrade that changed a few facets of Ethereum’s functionality including mining protocol and code execution. It activated six EIPs including the introduction of the ProgPoW—a proof-of-work algorithm designed to close the efficiency gap available to specialized ASICs.On Dec. 5 2019, Ethereum successfully hit block number 9,069,000, where the Istanbul hard fork has been completed. Istanbul is Ethereum’s eighth hard fork overall, addressing issues such as denial-of-service attack resilience, interoperability with equihash-based proof-of-work and gas costs, which is the cost to send a transaction on the Ethereum network.

The lowered gas costs enabled by Istanbul’s Ethereum Improvement Proposals (EIPs) are aimed to increase the bandwidth on the blockchain and foster zero-knowledge privacy technologies.

Vitalik Buterin has claimed that the capacity now has the potential to reach 3,000 transactions per second.

A few popular crypto exchanges including Binance announced their official support for the Ethereum Istanbul hard fork update. The Ethereum network has witnessed the collaboration between node operators and miners to update the software to support the Istanbul hard fork.

Muir Glacier Fork

The developers forgot to diffuse the difficulty creep during the Istanbul hard fork earlier in December 2019, leaving exchange employees and node operators awake even after the New Year celebrations. As Ethereum has faced the dilemma of moving to proof-of-stake in the usual way, delaying in the mining “ice age,” developers have voted to disable the difficulty time bomb for miners to be able to seek block rewards with the use of some time. Ethereum quickly made plans to hard fork once again on New Years Eve 2019 in what would be call the Muir Glacier Fork.

The Muir Glacier update was activated at block number 9,200,000 on Jan. 2, 2020, with only one improvement proposal, EIP 2384. The proposal aims to delay the difficulty bomb, a built-in algorithm of the Ethereum blockchain that could drastically increase the difficulty in mining a new block if left unaccounted for. The update is designed to delay the difficulty bomb for another 4,000,000 blocks, or approximately 611 days.

This is the third difficulty bomb delay the Ethereum network has undergone, with the first two occurring in 2018 and 2019.

Stage Four—Serenity

Serenity is the ultimate goal of the Ethereum Blockchain. It will mark a complete transition to the PoS model. For a full preview of Eth 2.0 please click here.

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Indian Tech Giant Infosys and Matic Network to Reinvigorate Dapp User Experience

Partnerships in the blockchain ecosystem are becoming commonplace in a bid to build tech synergy. Blockchain-powered fintechs are striving for more rapid adoption of the decade-old technology based on new product offerings and enhanced user experiences. In a recent move to deepen these novel tech ties, Indian tech giant – Infosys has joined Matic as one of its pioneering transaction validators.

What the New Partnership is Offering

The Matic Network is a blockchain centric company that is focused on reinvigorate decentralized applications (DApps). The company hopes to change the slow, complex, and expensive nature of decentralized transactions. In achieving this objective, it hopes to leverage a combination of blockchain scaling, developer tools, and great user experience. Since inception, the company has helped DApps including BankIT, Plentix, and others to scale their transactions.

The partnership with Infosys, one of India’s top tech companies will afford the firm to have access to a stronger technological infrastructure to power a stronger blockchain ecosystem. Infosys will bring in their long-standing experience in the tech world since its inception in 1981. The digital transformation tech giant will be deploying the needed technologies to validate transactions on Matic’s DApps. These value additions will also help keep DApps safer for users.

The partnership between Matic and Infosys may also help Matic to attract new investors with cross-functional decentralized product offerings.

Key Takehomes for Blockchain Enthusiasts

DApps are the next big trend in the cryptosphere as its network enables more efficient transactions, prevents internet censorship, and stirs increased trust in the system. The Infosys-Matic partnership should be considered a big win as it will enable the onboarding of more DApps. This will also translate to a better image for the entire blockchain network which will further boost its adoption. Every innovation to bolster the importance of Dapps are currently been celebrated as users in the blockchain ecosystem patiently await the launch of Ethereum 2.0

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Algorand Protocol Stateful Smart Contract Upgrade Targets Scalable DeFi Solutions and Dapps

Algorand, the first pure proof of stake (PoS) blockchain protocol, is entering the decentralized finance (DeFI) ecosystem with its new highly scalable smart contract capabilities.

The Algorand Foundation announced the launch of the comprehensive smart contract capabilities that will purportedly enable DeFI developers to create Defi solutions and Dapps that “can scale to billions of users” while benefiting from the security of its base layer Algorand protocol.

According to the blog on Aug 19, restrictions around scale, transaction speeds and high transaction fees have been barriers to mainstream blockchain adoption. Algorand’s latest upgrade of “stateful smart contracts […] removes these barriers and enables DeFi and dApp developers to build more sophisticated solutions, scale their applications, and make the promise of a borderless economy a reality.” The layer-1 integration of stateful smart contracts join existing capabilities such as Atomic Transfers.

Algorand and Defi

Algorand’s Pure Proof-of-Stake consensus protocol was designed for enterprise-grade utility and was built to overcome what was known as the blockchain trilemma which was the issue of achieving scalability, decentralization, and security simultaneously in a blockchain, which many saw as unfeasible.

As the blockchain industry continues to approach maturity, the developer team is hoping that these latest advances in Algorand’s smart contracts could propel decentralized applications and the DeFI space to take on established financial systems.

Silvio Micali, Founder of Algorand said “DeFi gives the world access to an essentially unlimited number of financial products and services. It’s important for the new generation of dApps not to be stalled by the shortcomings of the first-generation blockchains” He added, “Algorand’s protocol serves as a solid foundation to power truly frictionless applications, and our approach to smart contracts makes them high-performing and functionally advanced enough to rival today’s existing financial services.”

CBDC in Marshall Islands

Since Algorand’s mainnet launch a year ago, nearly 400 companies have joined Algorand’s ecosystem, leveraging the platform to build an assortment of applications, from investing with Republic to supporting stablecoins like Tether and even the development of central bank digital currencies or CBDCs for the Marshall Islands.

The Republic of the Marshall Islands revealed back in March, that the blockchain for the world’s first sovereign digital currency will be built using Algorand’s technology.

Plans for the Marshallese Sovereign (SOV)were first announced in February 2018 following a vote by the nation’s parliament in favour of proceeding with the plan.

SFB Technologies is the company responsible for developing the blockchain infrastructure for the Marshall Islands. In an announcement on March 2, the technology provider shared that the initiative to implement the Algorand protocol into the Marshallese SOV’s infrastructure was necessary to bring together the digital currency and mainstream regulatory compliance.

The SOV will circulate alongside the US dollar and help the Marshall Islands efficiently operate in the global economy. According to Algorand in the statement, “The SOV supply will be algorithmically fixed to grow at 4% each year to prevent runaway inflation. The SOV will be introduced through a token pre-sale: rights to future SOV will be sold in a series of auctions as part of a time-release monetary issuance (TRMI), which is expected to begin this year.”

Coinbase CEO Armstrong and Tech Giant Apple Butt Heads over Crypto and dApps

Coinbase CEO Brian Armstrong has publicly voiced his disappointment over Apple’s seeming lack of flexibility over enabling decentralized application (dApp) browsers operating off its App store.

Coinbase to Potentially Remove App from Apple

The American coin exchange CEO had previously announced to its users that Coinbase’s mobile wallet may potentially be removed from Apple’s App store. The Coinbase iOS compatible application enabled users to buy, sell and send cryptocurrencies, but due to Apple’s guidelines, the developers behind the Coinbase crypto wallet application were forced to revise the app’s features and amend it. Apple appeared to dislike the DApp browser feature that came with the crypto wallet application, and so Coinbase was forced to drop the functionality from its mobile wallet application that was offered on Apple’s App store.

CEO of Coinbase Armstrong publicly explained his stance and called out Apple’s reluctancy to embrace cryptocurrencies and dApps. He said:

“Apple has been very restrictive and hostile to cryptocurrency over the years. They’re still blocking some functionality right now, including the ability to earn money with cryptocurrency by completing tasks, and unrestricted dApp browsers.”

Coin exchange giant Coinbase had announced in December that it may potentially have to remove its dApp browser functionality, as Apple was not happy with it. and it did not respect the policy guidelines imposed by Apple. The news came after both Apple and Google had declared that they wanted to remove dApps entirely from their respective app store platforms. Google had carried out its wishes by taking down Ethereum-based decentralized application browser Metamask from Google Play Store.

Apple Grilled on App Store from US Congress

Tech giant Apple had recently come under fire for how it handled the App store. In an antitrust hearing that occurred in June, Apple along with its counterparts, Facebook, Google, and Amazon were subject to an antitrust hearing with US Congress. Capitol Hill had been meaning to update its regulatory policies revolving around the tech industry and had been building a case on the “Big Four” tech firms for quite a while, as many rival companies have complained about the unjust leverage of power that the four tech giants used to overturn competition in the industry.

For Apple, lawmakers grilled the company for the way it handled its App store and opposing firms that offered similar products. The Judiciary Committee also confronted Apple on its policy of taking a cut of 30% in commission for its in-app sales and subscriptions. This has greatly impacted Spotify, who appears to feel as if a large scale of its revenue is being surrendered to the American multinational tech company.

Algorand for Scalable Blockchain, DeFi & DApps

With the continuing growth of decentralized applications, a scalable blockchain is highly sought after by developers. Algorand Foundation recently launched a comprehensive smart contract protocol that enabled decentralized finance (DeFi) developers to create DeFi solutions and Dapps on a highly scalable blockchain. The base layer, Algorand protocol, boasts of high security and appears to be the first pure Proof-of-Stake (PoS) blockchain protocol to be launched.

The rise of DeFi had led to many more decentralized applications (DApps) being created and innovatively integrated into blockchain ecosystems for general trading, storage use, and much more. In Coinbase CEO Armstrong’s opinion, the future is inevitably moving towards crypto adoption on a global scale. Coinbase’s Armstrong is a strong cryptocurrency advocate and thinks that with digital assets set in place, “basic economic rights” can finally be accessed by people worldwide, even those in poorer countries.

The debate between Coinbase and Apple continues, as Armstrong is very adamant that Apple is too restrictive over cryptocurrencies. To him, digital assets can only mean good things and are the step to take in order to revolutionize the economic landscape globally.