Welcome to the crypto world, where the Ethereum ecosystem hosts over 3,000 projects that add value to several industries.
For some years now, Ethereum has been the second-largest digital currency, after Bitcoin, mostly because it's more than digital cash. Ethereum was developed to expand Bitcoin's use cases by creating a global ecosystem that facilitates the creation and deployment of decentralised applications. Now that the Merge is successfully completed, the number of projects released on the network is expected to rise. If you're new to the crypto market, we should mention that Dapps are different from web and mobile-based apps because they provide the users with extensive control over the data the apps receive. Traditional apps like Facebook, Instagram, or Twitter are managed by a central authority which decides how the users' data is used and secured.
Dapps are different because they put the control in the users' hands with the help of blockchain technology. Ethereum is both a platform that enables the creation of Dapps and an altcoin.
Image source https://www.freepik.com/free-vector/gradient-isometric-nft-concept_13816139.htm#query=ethereum&position=1&from_view=search&track=sph
What is Ethereum?
Computer science student Vitalik Buterin developed the Ethereum blockchain and launched it in 2015 after realising that Bitcoin's capabilities are limited. Ethereum is a decentralised open-source blockchain that compliments Bitcoin by offering a network that hosts autonomous smart contracts and enables the creation of decentralised applications.
The ecosystem's innovative architecture encourages the development of independent crypto projects, supporting the rise of DeFi (decentralised finance), GameFi, NFTs, and Metaverse. The extensive range of applications Ethereum offers to various industries has seen it become the second-largest digital currency by market cap. If you want to invest in an Ethereum-based project, buy Ethereum online from a reputable exchange like Binance because the network allows purchases via its native token.
Ethereum's most important use cases are technology, art, finance, and gaming.
Ethereum's smart contract-governed ecosystem revolutionises crypto technology because it allows developers to establish predefined rules and parameters. Ethereum's code facilitates the creation of custom Dapps serving different industries.
NFTs are an addition to the Ethereum blockchain that has gained extraordinary popularity over the last few years because they reform the art sector by providing an essential thing that has always been valued – provenance. The most prominent NFTs are Bored Ape Yacht Club, CryptoPunks, and CryptoKitties.
Decentralised finance has skyrocketed lately, and DeFi is the innovation that disrupts the traditional financial sector by offering new ranges of products via blockchain technology.
The gaming industry also explores the potential of integrating blockchain technology and especially Ethereum.
What is ERC-20?
ERC-20 is the standard protocol for fungible tokens created on the Ethereum ecosystem. The tokens that can be traded for other digital currencies are defined as fungible, and ERC-20 powers the exchange of smart-contract-enabled tokens. Tokens could represent digital money, assets, or everything else that is unique and can be transferred from one holder to another.
The most important projects deployed on the Ethereum ecosystem
At present, the projects based on the Ethereum blockchain that disrupt the industry are focused on decentralised finance, as its goal is to expand the utility of digital tokens from traditional transactions to financial use cases.
Uniswap is a decentralised exchange created on the Ethereum blockchain that allows users to control their funds. The project is a pillar of the ecosystem's booming DeFi movement because it makes it easier for users to trade coins. A unique characteristic of Uniswap is that it uses an automated market-maker system to power trading through smart contracts.
Stablecoins are altcoins that aim to improve the pain points of digital currencies. Investors are often deterred by crypto's high volatility, as their prices fluctuate unpredictably, making them unsuitable as stores of wealth or payment options. However, most stablecoins are centralised, making people have second thoughts about using them. MakerDao is a unique stablecoin project because it has a complex decentralisation protocol.
Chainlink is also a unique kind of project because it was built as an oracle platform that connects smart contracts with data from the real world, like stock prices. Smart contracts rely on data to complete pre-defined tasks. Chainlink was launched on the Ethereum network in 2017, but it started to gain popularity around 2019 when it started a partnership with Google.
Aave is an open-source lending protocol that allows lenders to contribute digital assets into liquidity pools to gain rewards and borrowers to use assets as collateral to get loans. The liquidity pool's utilisation rate determines the Aave platform's interest rates, allowing lenders to get low-risk passive profit from loan interest without the involvement of an intermediary.
Ox is a DEX deployed on the Ethereum network, launched in 2016, that functions like a peer-to-peer exchange for trading ERC-20 tokens and other digital assets using smart contracts. Its native token, ZRX has two utilities; it can be used for governance and to pay trading fees. The OX platform was created to enable the creation of a DEX using the Ox Launch kit. It allows users to exchange different tokenized assets like video game items, real estate, stocks, and even gold. Its purpose is to facilitate interoperability between Dapps.
Tether is an old project in the crypto world, created in 2010 and launched in 2014 as a platform that issues digital assets linked to the value of fiat money. The developers started from the idea that blockchain technology can use the Omni layer protocol to issue cash. Therefore, it enabled the creation of USDT and, at present, supports EURT, CNHT, XAUT, and USDT tokens.
Tether was initially launched on the Bitcoin blockchain, but now it's also available on Ethereum, Algorand, Tron, EOS, and the OMG Network. Its largest market for USDT is Ethereum. Tether's appeal lies in its stability because it doesn't allow volatility to impact its value. However, we should note that its value fluctuated away from the currency it's pegged to.
The Ethereum blockchain plays a paramount role in the rise of innovation in the crypto space, and the above examples are proof of it.