- >The Top Five Ethereum Killers in 2021
The Top Five Ethereum Killers in 2021
Cryptocurrency can be a confusing field to navigate, especially around some of the lesser-known currencies. What’s the difference between the mainstream titan, Bitcoin, and the rest of the cryptocurrencies? Ethereum is the main competitor, but given their shaky history, could the currency be stopped? And if so, by what? In this article we explore the top give projects that could overtake Ethereum.
Michael Brown | Mar 4, 2021
First on the menu of ethereum killers is Polkadot. The new kid on the block, DOT launched in 2020, and the tokens are fairly cheap at this time. DOT’s claim to fame is that it’s blockchain allows for arbitrary data to be exchanged, not just specific data carried on traditional blockchains. This is impressive because this is part of what allows Polkadot to be transferred across multiple different blockchains. That’s a lot of technical jargon, but in short this allows DOT to be transferred in a variety of ways, across a potential variety of platforms. It’s an ambitious project, with broad spectrum applications.
The data loaded onto DOT’s blockchain can be exchanged on private networks available to some as well as public ones available to all. It can go between them as well, meaning a private network can trade to a public one and vice-versa. This has applications in a variety of fields and not just in the trading of currency. An investment in DOT, may be a broad-ranging investment, and not solely tied to the field of currency. When you invest in DOT, you’re primarily investing in the technology of it, not necessarily the currency. Certainly an interesting Ethereum alternative.
Next up on our menu of Ethereum killers is Tezos. XTZ is very user focused; An open source project, allowing users to weigh in on project governance and the direction of the blockchain, for a buy-in price of 8,000 tokens. This user governance is designed to prevent forks and conflict in the currency, which should, in theory anyways, retain value in the longer term as more users adopt the technology. In addition, what makes XTZ impressive is it’s security, modularity, and ability to be upscaled. Three things that are important on their own, but impressive when they’re all rolled in together. This is an ambitious claim, but how does that work?
Thinking with the future in mind, stakeholders of XTZ can shape the trajectory of the project. XTZ was among the first to use a proof-of-stake mechanism rather than proof-of-work, way back in 2017. Proof-of-stake is becoming increasingly popular among blockchains, compared to the proof-of-work loaded into traditional blockchain currencies like Bitcoin. Tezos rewards users for contributing to blockchain consensus with their proof-of-stake system. What that jargon means, is that users are rewarded for contributing to the security and stability of the network.
Third on the list is Cardano. Founded by Ethereum co-founder, Charles Hoskinson. Cardano is also a proof-of-stake, open source, blockchain like the previously mentioned Tezos. Cardano brands itself as a more academic blockchain project, with new ideas and additions to the project requiring a peer-review before they can be adopted on the network. The design theory behind this peer-review concept is that this will create a more robust network that will be able to solve potential problems sooner before they become serious problems.
Cardano’s philosophy is centered around individual governance and reaching consensus. Each token holder is given a stake in the network and are incentivized to vote and participate in how the network functions. These are divided into two categories. A funding proposal (FP) and Cardano Improvement Proposals (CIP). FPs are voted on via dedicated application and CIPs are done through a GitHub repository.
These systems allow stakeholders to make proposals about functions that Cardano/ADA doesn’t have at a particular moment. Each vote requires a temporary payment of ADA, to ensure accountability and that successful proposals receive funding. With a supply of 45 billion, ADA is very cheap on a per-token basis. At this time of writing, it is worth over $1 US dollar. If direct democracy on a budget is your thing, this is the ethereum killer for you.
The cheapest token on our list, weighing in at about half of $1 USD per token, is Stellar. Yet another open source project, Stellar provides its user base with the ability to create, send, and trade all forms of money in a digital format. So you could trade Mexican Pesos for US dollars for example. Stellar is an ambitious project, making the claim that all of the world’s financial institutions could run on the network. Blockchain technology keeps the XLM network in-sync across devices. This is similar to previously mentioned Polkadot, where this is more of a blockchain technology investment, rather than a dedicated currency such as Bitcoin.
Stellar produces a token of its own called the Lumen, which is used in small volumes to process the actual currency transactions. To continue with the example above, Stellar would permit you to create a digital representation of a Mexican Peso. You would call this a Peso Token on the Stellar network, and then tell everyone on the network that for anybody that deposits a traditional US dollar into that account, you’ll give them a Peso Token. When this person comes back with their Peso Tokens, you exchange that in turn for traditional US dollars. So in essence, you become your own little Federal Reserve, except you get to choose what your token is backed by.
NEAR Protocol (NEAR)
The last, but certainly not the least, project on the list is the NEAR protocol. NEAR is an open source project focused on smart contracts and the proof-of-stake system, like most other Ethereum killers on our list. A big selling point with NEAR is the lower transaction fees. NEAR claims that their transaction fees are 10 times lower than Ethereum’s. What makes NEAR unique, is their focus on development, community, and creation of applications.
If you’re already an Ethereum holder, NEAR has your back. NEAR’s rainbow bridge technology allows holders of ethereum to operate on both blockchain systems. NEAR’s rainbow bridge is part of their effort to support the upscaling nature of blockchain technologies. The mission with the rainbow bridge is to enable low friction movement of assets and data across different blockchains. I recommend reading up on it in the link above if you’re already holding ethereum, but are considering a move.
Creating apps, nodes, or pretty much any digital service on the NEAR platform offers rewards of some kind. Their website has a ton of details and it’s loaded with a lot of technical information that developers and would-be noderunners would want to know. NEAR’s token is currently valued at $4.26 at this time of writing, and is the least mature project of the bunch that we selected. What does that mean? It means that it has the most potential to grow in the future.