Cointelegraph follows the development of a completely new blockchain, from inception to mainnet, and beyond, through its series, Inside the Blockchain Developer’s Mind, written Andrew Levine, Koinos Group.
Social applications are used daily by people, but despite the hype surrounding supposedly “next generation” blockchains, none of these social apps are decentralized. Let’s look at why using Steem and Ethereum as a reference.
Ethereum is home to more developers than any other general-purpose blockchain. Yet, none of these developers has been able to create a social app that gains mainstream acceptance. Steem was once the most popular blockchain in the world. It was also the most popular social DApp in the world. The market capitalization of Steem reached an all-time high at $2 billion.
Steem was able grow quickly and to onboard hundreds upon thousands of users. However, it never achieved the same level of developer adoption as Ethereum and eventually failed to live up its potential. This is an important lesson in building both DApps as well as blockchains.
Related: DeFi’s future is spread across multiple blockchains
Ethereum is a general purpose blockchain
Steem was built on Ethereum, which was the only viable and usable blockchain that developers could use to create their DApps without having to modify or fork the code of a Bitcoin blockchain.
Instead of building a blockchain from scratch to support a specific application (like a social networking site), developers can simply write the code and upload it to Ethereum as a “smartcontract”. This will allow them to take advantage of all the work done by Ethereum blockchain developers to focus on their application.
Developers could upload code to the Blockchain, which opened up infinite possibilities. It also allowed code to be uploaded that consumes all network resources and renders it useless. Vitalik Buterin created “gas” to solve the problem. This is a decentralized system that charges a fee for executing code on a blockchain.
Related: Ethereum fees are skyrocketing — But traders still have options
The brilliant fee-based design of Ethereum set the standard for general purpose blockchain design. Nearly every subsequent blockchain has implemented some form of gas.
The genius of Ethereum was that it allowed developers to access a unlimited (“Turing complete”) programming language. Gas is unique in that there was a decentralized limit on the possibilities for developers to use that language. This conflict (limitless vs. limited) is what explains why Ethereum has no social DApps.
Blockchains that are fee-free
The Steem developers used a completely different approach to Ethereum. They built a very basic blockchain (a “framework”) named Graphene that they could easily transform into a specific social blockchain (an “application-specific” blockchain).
The Steem developers also experimented with social features and a system to regulate network usage. It was fundamentally different than gas. It was free.
Many people believed Steem was a fraud when it first launched. This was due to its fee-free “bandwidth”. They thought that a blockchain free of fees would fail because Bitcoin and Ethereum both had fees.
Related: Which decentralized blockchain is best? Experts have the answer
Although the bandwidth system Steem launched using was not perfect, it offered social features and allowed users to transact at no cost. Steem quickly became the most popular blockchain in the world and the most widely used. But, ultimately, it never competed with Ethereum.
Smart contracts are the future
To many people’s surprise Steem could not compete with Ethereum because of its fee-less model. The core developers worked over the years to improve the model and it is still in use today.
Steem was never able to compete with Ethereum simply because Graphene, the blockchain framework that it was built upon, did not support smart contracts. Although Graphene was easier to launch specific blockchain features, it was not easy to change or add new features. This was in contrast to Ethereum which allows anyone to upload any code whenever they wish.
This perspective makes it easy to see the solution. Combining the Steem fee-free system with the flexibility and security of a blockchain with smart contract like Ethereum would give developers the best of both the worlds, allowing them to create applications for free with the ability to add new features as they please. Simple, right?
Keep checking back for the next article to learn more!
This article is not intended to provide investment advice. Every trade and investment involves risk. Readers should do their research before making any decision.
These views, thoughts, and opinions are solely the author’s and do not necessarily reflect the views or opinions of Cointelegraph.
Andrew Levine is CEO of Koinos Group. This group consists of industry veterans who are committed to decentralizing society through accessible blockchain technology. Koinos is their foundational product, which is a free and infinitely extensible blockchain that supports universal language support.
Eileen Wilson –Technology and Energy
My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.