Blockchain has been the word on the lips of every entrepreneur over the past few years, with this exciting technology helping to create a new industry of crypto-powered businesses. As the crypto market has grown, new coins have risen and fallen, driven by lofty ambitions around changing the world. However, few coins have managed to capture that revolutionary aspect as much as Ethereum, which has become the second most popular cryptocurrency by market cap after Bitcoin.
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Ethereum first launched in 2015, and while it uses the same kind of blockchain technology as Bitcoin, it functions in a very different way. Ethereum is designed to allow anyone to set up smart contracts, which are contracts that automatically close under certain conditions. This can allow for transactions to be programmed and has led to a wave of decentralized applications (dApps) and the evolution of decentralized finance.
What Are dApps?
One of the main selling points of Ethereum is that it allows anyone to create their own tokens and decentralized application, also known simply as dApps. Like regular applications, these can be used to perform a variety of different tasks, with everything from gaming and social media to finance and education. Major dApps include the online game CryptoKitties and the decentralized crypto exchange IDEX.
The advantage of dApps over traditional applications is that they’re not controlled by a single organization. Instead, it’s completely open source, meaning anyone can use it, and its data and records are public. This could help to break up the monopoly that tech giants have over the internet, helping to create a more diverse and open online space.
dApps are built on the Ethereum network, which means that establishing payments through them is incredibly simple. This makes it ideal for a wide range of businesses, especially those that have a target audience who are interested in cryptocurrencies. dApps have the added advantage of being less likely to suffer from downtime and offering increased privacy.
How The Ethereum Merge Created New Opportunities for Blockchain Businesses
The Ethereum blockchain started out as a Proof of Work network, just like Bitcoin, where blocks are mined by solving hashes and verifying transactions. However, in September 2022, Ethereum completed the Merge, which saw it move to proof of stake.
Under the Proof of Stake model, Ethereum transactions are verified by nodes which have staked a certain amount of Ether as collateral. This has helped to make the network more environmentally friendly while also lowering the barrier of entry for businesses and making things more secure.
This can only help to increase the opportunities for businesses based on blockchain technology, particularly those that have invested heavily in Ethereum. Compared to other crypto networks, Ethereum now presents the most attractive opportunity, and companies such as CSO.co have seen an uptick in the number of blockchain businesses looking to promote their services.
The Future of Businesses on the Ethereum Network
With the Ethereum network now based on Proof of Stake, it works better than ever before, offering plenty of opportunities for growth. In a world that’s increasingly aware of environmental impacts, having a lower footprint is extremely important. dApps built on Ethereum can now advertise the fact that they’re low-carbon or even carbon-neutral, and this has an enormous amount of potential.
Aside from that, having greater security and fewer risks of hacks or data breaches is also great for the future of crypto businesses. This is particularly true for decentralized exchanges or other financial services dApps, which might otherwise have been put off by security issues in blockchain. The future of Ethereum-based dApps and businesses is certainly bright, and who knows what the future might hold.