Ethereum’s network is widely known as a popular platform for hosting decentralized applications. Even during 2016 and 2017, new releases of applications in the Ethereum network were repeatedly presented, such as solutions for logistics, business, medicine and education, online games also play a significant role. It is also necessary to take into account that it is practically not difficult to create a smart contract for business processes in Ethereum environment. Such an action can take about an hour, the main thing is that the data is entered correctly and without errors. That is why the flexibility and simplicity of the Ethereum network create all the conditions for the implementation of any ideas for developers. The question arises – has it played a cruel joke?
It was also repeatedly stated that many projects that were created by the method of crowdfunding and ICO at the end of 2018 were closed. There are many reasons for that. One of them is that the developers did not calculate the financing while creating the project, or simply the opportunities did not coincide with the current market realities. Still, the 2018 correction put everything in its place. The weak were eliminated, while the strong remained. Some hedge funds have shown a decline in the value of their assets even though they are investing for 5 and 10 years. And the question arises, is there any evil joke, or a collapsed Tower of Babel?
Ghost projects as ghost towns
Why did this question arise? The fact is that the latest statistics from dappradar.com speaks about the huge share of “empty” decentralized applications. The fact is that out of more than a thousand applications on Ethereum blockchain, only the fifth part has users. It is also surprising that only a hundred among the running applications have transactions. Such a number of “ghost projects” speaks of existing problems on the broadcast network, and as mentioned above, there is too much interest in the network’s capabilities. After all, it is known that network sharding (expansion of nodes) is delayed. As a result, weak throughput is obtained. This leads to a longer transaction time and increased commission. In addition, there is a crypto-exchange in which they daily buy and sell large volumes of Ethereum, thereby creating a load on the network. And at the end, the next brainchild of Ethereum developers is a game called “Cryptokitties.” It also makes a significant share in the complexity of network bandwidth. In total, adverse conditions have already been created for the implementation of decentralized applications.
All existing problems can be attributed to the immaturity of the industry. For example, the Bitcoin network did not have the implementation of smart contracts and broad conditions for business development as Ethereum did for a long time. The task of the Bitcoin network is to be a means of payment. And similar blockchains that just started at the end of 2017 were faced with the problems of cryptocurrency market correction and mining crisis. Simply speaking, they started too late to create a worthy competition for the Vitalik Buterin network.
Therefore, “ghost projects” have become commonplace, as evidenced by statistics. At the same time, it is practically the same as the Chinese “ghost towns”, which are built for the long term. As the Chinese themselves are not particularly able to buy new real estate, and there is no desire to migrate to another region for the sake of the new building. The same thing with the network of Ethereum – capital loves the activity, liquidity, it flows where (conditions) supply and demand are present.
It is not over – it is just the beginning.
At the beginning of this year, you could hear more than once that the fundamental component of the cryptocurrency market is growing. Namely, some US states are gradually and partially legalizing cryptocurrencies. Since the fake ICOs have more or less dropped out, strong and working projects have remained. The Lightning Network technology is actively developing, which has greatly relieved the Bitcoin network. With all this, many experts are already seriously declaring the imminence of the ETF on currencies legalization. This decision will allow attracting large investors for a long-term perspective. All these components can only accelerate the rebirth of the industry. At the same time restoring the popularity and relevance of decentralized applications.