Choosing a Blockchain for Your Next Decentralized Project: Detailed Comparison of Blockchain Ecosystems
The 21st century has given the world a groundbreaking tech innovation, blockchain. It emerged as a solution to excessive centralization and control of user data and finance, paving the way to Web 3.0.
The blockchain market exceeded 4.67 billion in size in 2021, and it’s projected to nearly double to 7+ billion by the end of 2022. The expected CAGR of market growth is a whopping 56.3% a year until 2029, promising an exciting decade for all blockchain businesses and users.
So, how can you embrace this hyping trend and keep pace with the innovation? Is it possible to hope on the fast-moving blockchain train to monetize this industry’s potential? Sure, you can join in, and 2022 is ripe for these opportunities. But the key to success is choosing the right technology that will fuel your startup for growth.
Here we examine the existing blockchain technology landscape to introduce you to the thrilling world of blockchain ecosystems. Reading this article, you will know the blockchain world much better, understanding the features of various options to make informed decisions.
Types of Blockchain Ecosystems
Though a relatively new concept, blockchains have already branched out into a complex system of ecosystems and networks, each with its own characteristics in terms of governance. Here are the types you can currently consider for your startup.
This traditional blockchain model presupposes having only one leader in control of the entire ecosystem’s governance. As a rule, such models focus on a specific aim of the blockchain, delivering the service to their clients in a brand-new way. For example, a Kidcoin project provided an innovative way to help parents educate their children about money management and spending. It featured one leader, the provider of financial services, and multiple service recipients, such as children, parents, and educators using this product in their curricula.
Joint Venture or Consortia Ecosystems
This model of blockchain governance arrangement means having several entities in control of the system’s functioning and rule-setting. The consortia model revolutionized the sphere of joint ventures by giving the JV participants new effective and transparent ways of organizing their activities in a regulated manner without leaving anyone overboard. An illustrative example of such a project is Klash, a film collaboration platform unifying various film production stakeholders, each having a say in this collaborative initiative.
Regulatory Blockchain Ecosystems
The regulatory ecosystem model aims to unify various regulatory agencies and institutions around a single goal. These ecosystems are set up in the spheres requiring strong regulatory control and audit of organizational activity, as in the case of governmental agencies, financial establishments, investment, or public-sector functioning. A notable example of a regulatory blockchain is the Green Assets Wallet (GAW) initiative created to regulate green bond investments and give investors more confidence and transparency in the process.
Components in Blockchain System
Every ecosystem has specific components that ensure its functioning and contribute to its purpose. Here are the elements you should think about.
The leading role in an ecosystem is assigned to one person or entity (a group of entities in the consortia model) who make the business case for the system and strategize its mission and vision. Leaders are typically the system’s developers/creators, and they are the primary beneficiaries of this project’s success.
Next in the hierarchy of the ecosystem comes the core group of the project’s think tanks and activists who set the project’s direction and strategy. They also hold responsibility for optimizing the ecosystem’s operational activities and letting it function properly without downtime. The core group often conducts the overall management activities.
The group of active participants includes miners and validators guaranteeing the processing of on-chain transactions. They are more plentiful than the core group and leaders, taking on the task of day-to-date workflows and data management within the ecosystem. This category of users makes a vital contribution to the system’s proper operation in line with blockchain principles.
This is the most plentiful category of blockchain ecosystem users, as they are the end recipients of the blockchain’s functioning-related benefits. These users come to the system to exchange their funds for services, store their data, and complete on-chain transactions of various sorts. Therefore, user adoption fuels the system’s growth and contributes to its business success.
Third-Party Service Providers
Third-party participants of a blockchain ecosystem actually function beyond it but complement its services and features via an API connection. Users and activists of the blockchain ecosystem determine what they lack in the current structure, adding third-party services for completeness of service coverage and better UX.
Blockchain Ecosystems Comparison Table
|Liquidity Markets ||Compound |
|Hundred Finance |
|Perps/Leverage Trading||GEARBOX BB |
|GMX Tracer Future||Drift|
|Fund Management ||Babylon Finance |
|Fixed-interest rate protocols ||Element |
|Barnbridge||Port Finance |
|NFT Exchange ||OpenSea|
Private vs Public Blockchain: A Detailed Comparison
The fundamental difference to keep in mind when choosing a blockchain is the public versus private one. These blockchain types follow different principles and focus on different benefits for users. Therefore, you can choose the technology type only after considering the features public and private ledgers come with.
What Is a Public Blockchain? A Quick Overview
A public blockchain type is permissionless, meaning that it poses no restrictions on the users in terms of data access and activity permissions. Any person can join the network and get access to nodes. Everyone has the right to join the mining pool and participate in granting consensus. Public projects are thus fully decentralized and immutable, fully complying with the blockchain philosophy of universal access and equality.
Their features include:
- complete decentralization
- full transparency
- 100% user control and empowerment
What Are Private Blockchains? A Quick Overview
Private blockchains are more centralized in nature, as they are owned and regulated by a single controlling entity setting the access rules and permissions for users. Therefore, they are referred to as permissioned blockchains. Though the principle of one-leader regulation might seem to contradict the democratic principles of blockchain technology, private blockchains still function in line with the distributed ledger rule and give all their users access to nodes.
Typical features of private blockchains are:
- a greater degree of efficiency
- low gas fees for on-chain transactions
- better privacy protections
- enterprise-centric business model
- stability and safety of operations
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Popular Blockchain Ecosystems
The first blockchain system that emerged more than 15 years ago was Bitcoin. Though it’s still a golden standard of investment and a primary reference point for the blockchain world’s heartbeat, Bitcoin doesn’t possess the functionality for non-BTC transactions. Ethereum emerged as a solution to that limitation, with many more blockchain options surfacing in later years. Here are the top 11 options you can choose from.
As we are an official integrator of NEAR protocol and work on many NEAR-powered projects, we have decided to start our list of top blockchains with it. This is a Layer-1 blockchain created in 2018 and launched by a team of engineers and researchers of the NEAR Collective. NEAR is ideal for quick and cost-effective dApp development. It uses the PoS consensus mechanism and gives a user- and developer-friendly infrastructure for creating various projects. You can develop smart contracts and sophisticated system logic using well-known programming languages like Rust and AssemblyScript.
Ethereum was the first alternative to Bitcoin, emerging in 2015 to enable a broader range of transactions on the blockchain. Now Ethereum is used by millions of developers across the globe, serving as a basis for digital money transfers, global payments, and dApp development. The ERC20 token, a standard of Ethereum blockchain, helped mint hundreds of cryptocurrencies for Ethereum-powered projects. Thus, at present, Ethereum is a huge ecosystem of blockchain projects enjoying the robust performance and frictionless interoperability.
Avalanche (AVAX) took the crypto world by storm when it was launched in 2020. Many things are done differently on AVAX, including the higher transaction speed (4,500 tps), greater security, meager on-chain fees, and unparalleled accessibility. Avalanche is an open-source, permissionless project, meaning that every coder or user can easily join it and become an active contributor. It’s also an eco-friendly project, with a carbon footprint times lower than that of other well-known blockchains. You can create low-cost dApps on AVAX, running in full Solidity compatibility and minimal hardware requirements.
With the fast rise of the DeFi industry, Fantom has been enjoying quickly increasing attention on the part of users and developers. Creators of Fantom promote it as a solution made with the end-user in mind, a dynamic ecosystem giving full control to users and placing them at the center of governance. It’s a highly scalable solution able to power robust and secure DeFi apps, crypto dApps, and even enterprise-level blockchain projects. The major bonus for users of Fantom is a low gas fee for on-chain transactions.
Polygon emerged in 2017 to resolve the mounting problems of Ethereum with scalability and rising transaction fees. Thus, Polygon became a decentralized scaling platform on top of Ethereum, bringing the vision of Web3 to life. Over 19,000 dApps were created with Polygon, giving the developers and business owners a combined benefit of Ethereum’s network effects and powerful scalability. The Polygon PoS mechanism is fully compatible with Ethereum’s EVMs. Besides, the blockchain has become carbon-negative in 2022, giving users and developers an additional impetus for its adoption.
The Layer-2 rollup network for Ethereum is a relatively new entrant to the world of blockchain. It offers better security and promises to reduce the cost and latency of the Ethereum network. The project offers a frictionless gateway to Ethereum and is currently used for DeFi app creation. Therefore, the major work principle of Optimism is to release the workload from the Ethereum network (Layer 1) by computing a part of the pending transactions in Layer 2. This computational approach thus reduces the transaction fees in Ethereum and increases the blockchain’s performance.
Arbirtum is another addition to the Ethereum infrastructure, enabling quicker and more affordable transaction processing. It has been added to the complex of scaling solutions developed to help with Ethereum’s scalability problems. Arbitrum is spreading fast because it offers cheap and easy transactions while relaying all information back to the Ethereum blockchain. Its tps exceeds 40,000, and the solution is fully EVM-compatible, allowing the developers to integrate Arbitrum dApps into the vibrant Ethereum ecosystem.
The most important benefit of Solana is its speed. The blockchain made splashes in the industry because of its unrivaled user-friendliness, scalability, and over 2,000 tps. The cost of transactions on Solana is meager, which contributes to its fast adoption in the DeFi, NFT, and Web3 sectors of blockchain development. Besides, the bonus of Solana is frictionless composability, allowing a quick and developer-friendly buildup of Solana ecosystems without the need to integrate sharding or Layer 2 solutions.
Cosmos is a large and quickly growing blockchain ecosystem using its native token ATOM for on-chain operations. It is a new approach to blockchain networks featuring a web of interconnected apps and services, functioning in a totally decentralized manner. The philosophy behind Cosmos is to create a universe of connected services based on the Inter-Blockchain Communication protocol. Thus, Cosmos pursues the mission of universal blockchain connectivity for unlimited cross-chain exchange of assets and data.
Tezos is another blockchain solution emerging as a response to the pressing issues of Ethereum. It approached smart contract processing differently, adding more advancements to the existing infrastructure. Tezos features blockchain evolution and improvements without the risks of hard forks, giving XTZ owners the right to vote on blockchain proposals, protocol upgrades, and further Tezos development. Thus, the major pros of using Tezos are its unrivaled upgradability and security.
Popular Blockchain Ecosystems Comparison Table
|#||Name of ecosystem||Market capitalization||Number of wallets||Types of Blockchain Technology||Consensus||Annual inflation rate||TPS||Block time (sec)||EVM dApp support|
|1||NEAR Protocol||$6,13B||10M||Public||PoS||5%||100000||one ore less||Yes|
|9||Atom||$8,72B||1,1M||Public||PoS||7% - 20%||10000||~1||Yes|
What to Consider for Play 2 Earn Games?
Now that we’ve covered all existing blockchain systems in detail, let’s consider a practical example of choosing an optimal blockchain for a p2e game. The most important technical parameters for this blockchain-based product are as follows:
- TPS – the more transactions your blockchain processes per second, the faster and more reliable token transactions are. This relates to in-game and external token transfers, their movement between wallets, and in-game betting.
- Gas fees – the lower, the better. Games involve many transactions done by large numbers of players every minute, so users opt to adopt more affordable games.
- NFT support – every p2e game makes use of unique NFTs as additional user incentives. By finding and earning rare NFTs, gamers can earn revenue and increase their game rankings. Therefore, it’s critical to integrate the NFT functionality in your p2e game structure.
- EVM compatibility – it allows further integration of your game with other top-tier projects to expand the user base, enable gamers to sell their NFTs and tokens at external marketplaces, and allow payments with ERC20 tokens.
- Decentralization – the higher the system’s transparency is for users, the higher their trust and confidence in user control are. Users holding valuable assets and cryptocurrencies in their game accounts should be sure that the game’s owners will not abuse their power by manipulating their funds.
- Convenient wallets – this benefit increases user satisfaction and reduces token movement friction.
- The current number of chain addresses – this figure indicates the number of unique users and the ecosystem’s outreach to the target audience, which is also a sign of the blockchain’s reliability and security.
Thus, based on the comparison provided in the table above, you might conclude that the best blockchains for p2e game creation are NEAR, Fantom, Solana, and Polygon.
You need to keep in mind that choosing an ecosystem affects your project’s further operation, the client base you will reach out to, and the technical features you will be able to add to it. If you want to change the blockchain to another one after the project’s creation or in the process, it’s possible only with EVM-compatible blockchains. These are flexible and allow moving across blockchains. The ones written on Rust are not flexible, limiting your set of options to blockchains using Rust as well.
What to consider for dApp?
When you consider using a dApp development service, the choice of technology also matters much. The golden standard in this industry is still Ethereum, though it poses considerable scalability and affordability challenges. If you decide to depart from this standard, consider EVM-compatible blockchains like EOS, Tron, Solana, NEO, or Polygon.
The same applies to dApp development, which depends on the choice of an ecosystem and its functionality to a large degree. You need to factor in its use’s nuances, such as the speed and cost of transactions, scalability, and the set of features it supports. Think of the potential nuances of transition to another blockchain and make the final choice with an optimal set of specifications matching your project needs.
Questions to Ask Before Selecting a Blockchain Platform
Here is a set of criteria that may help you select the best blockchain option for your project.
What level of privacy do you need to maintain?
When you think about privacy, the major choice should be made between centralized and decentralized, private and public blockchains. Public blockchains are much more open and transparent, giving all user data out for the sake of democratization of data access. Private blockchains are more centralized, which may contradict your philosophy of blockchain, but at the same time, they keep more user data private, giving you essential protection from unwanted access.
A viable to using a private blockchain is to put a limited amount of user data on the blockchain, thus maintaining a balance between transparency and user protection. This can be achieved via p2p arrangements of sensitive data exchange, leaving you with a transparent, public ledger and robust client protection in one solution.
What scalability degree do you strive for?
Startups rarely think of scalability once they launch their humble projects with a small user base and little ambition. But the project may go insanely popular pretty quickly, which is typical for the crypto world. Thus, project owners face scalability limitations once the project is finished and launched into the digital space.
Introducing changes to such a project is costly and cumbersome, resulting in problematic downtime. So, our advice is to think of scalability in advance, ensuring that the latency of your selected blockchain is enough to sustain operational workload increases and traffic. Consider the number of nodes in the blockchain, factor in the tps criterion, and the blockchain’s consensus algorithm to see how much your project can scale without trouble.
How do you intend to use digital assets?
As a rule, blockchain projects use some native tokens that system users can exchange for services and goods on-chain. The cryptocurrency’s tokenomics often determines the project’s success as it shows the benefits for users coming with tokens’ acquisition, use, staking, and investment. The successful projects’ tokens also become a store of value for holders, and you need to guarantee that your token is secure and appealing, fueling your project’s adoption and spread. The choice between PoS and PoW consensus protocols is also significant at this stage, as these algorithms shape the process of digital asset distribution and transaction processing, giving your project a unique look.
Are there any accessibility issues to consider?
Modern apps and digital resources should be user-friendly and accessible to succeed. So, don’t discount the requirement for accessibility at the project planning stage. Think of the best design for user interfaces, provide users with functional APIs for full access to the project’s functionality, and make data storage solutions manageable for users. Besides, it’s vital to keep geographic accessibility in mind, using cloud servers to minimize the access frictions for residents of slow-connection areas.
As you can see, the choice of blockchain technology is a serious, responsible task that affects your project’s success and performance. Discuss all available options with your blockchain development company to avoid costly revisions and receive the broadest range of technology advantages. It’s always possible to find the best match out of the available set of options if you set clear project objectives and actional expectations.
What is the Blockchain ecosystem?
The ecosystem can be established within any blockchain, uniting several projects powered by one blockchain technology and sharing its resources to complement each other’s business objectives and processes. This way, a network of participants using the same blockchain infrastructure and able to complete transactions on-chain without extra interoperability requirements becomes an ecosystem within a specific blockchain.
How do I choose a blockchain for NFT?
NFT minting and trade are resource-intensive processes. Thus, if you plan to set up an NFT marketplace or minting platform, you need to factor in the security and transaction speed of the considered options. Besides, it’s vital to consider the blockchain’s scalability (e.g., Ethereum cannot boast impressive scalability, which limits the NFT projects powered by this blockchain). More beneficial options are Solana and NEAR, both offering endless scalability without performance or security compromises.
What are the benefits of a blockchain ecosystem?
The major advantage of joining a blockchain ecosystem with your new project is the ability to use a well-established infrastructure of existing projects’ resources. As all of them use the same technology and interoperate without friction or cross-chain bridges, you can add a complimentary service or platform to the current network, adding value to the current ecosystem’s structure and attracting an existing user base of that blockchain.