Recently, Brad Garlinghouse, CEO of Ripple made statements about “tribalism” in Bitcoin and cryptocurrencies holding the industry back. He said the polarization among bitcoin-only believers and those who hold more than one cryptocurrency is hindering the growth of the crypto industry.
This divide also affects how the general public viewed crypto and blockchain. He went on to say that competition among various cryptos and blockchains is the way to go, and that different blockchains can fulfill different needs, which will help the industry thrive. But is his point of view correct and applicable for the industry? Will the adoption of Web3 be faster with only one blockchain?
Do multiple blockchains hinder acceptance and ease of use? Or does competition help drive the industry forward with ingenuity and efficiencies? Let us explore and try to see points of both tribalism and competition, and what is the best for the mass adoption of Web3.
There are a good amount of bitcoin-only believers out there, and they are known as “bitcoin maximalists”. They believe that bitcoin is the only cryptocurrency that matters and all other cryptos are either scams, unnecessary, or inferior from this major revolutionary crypto which is bitcoin. Despite their extreme belief towards bitcoin, these maximalists are still valid in thinking that some of the launched coins and tokens are fraudulent and scams, especially when crypto became a boom with its fast money promise.
But not all of them are scams. Out of the thousands of cryptos out there, some really have good value, management and stability. Individuals should educate themselves first before picking out cryptos and tokens to avoid being scammed. The market downtrend also helps in weeding out bad cryptos, coins and tokens that do not provide real value and are built on shaky foundations. In a way, the maximalists’ view to improve bitcoin and its systems is good, but it cannot nearly hold all of the public’s requirements of blockchain technology as what they are thinking.
Using only bitcoin for all our blockchain needs (i.e. store data, transfer crypto, NFTs and other digital assets etc.) will overload the system, making all transactions on-chain slower and excessively expensive. Monopoly is clearly not the way to go. Rather than subscribing to only one blockchain and crypto, it is best to have a multiple-chain expansion plan or roadmap – if there is any to be created in the future – to foster competition, innovation, better offerings and further improve the industry as a whole.
In any industry, competition can automatically encourage innovation that will result in better services. It is a win for consumers and customers. To improve competition in the blockchain industry, there are some hurdles that must be overcome first to harness the technology’s full potential. One of the premises of blockchain and bitcoin when it started is the ease of transferring data or money from peer to peer. This is easily achieved when moving data or token on the same blockchain.
But if you have more than one blockchain created, the nature of the system is a stark contrast to its premise as blockchains are isolated and standalone. One blockchain equals singular crypto and token operating on it, and each one has a distinct language (code) from other chains. It is difficult for different blockchains to connect, talk to each other and facilitate transactions. One way to maximize blockchain technology is for multiple blockchains to be linked and carry out cross-chain transactions easily.
And this can be done through an open source protocol called Inter-Blockchain Communication (IBC). IBC acts as relays for data to be transmitted to blockchains, which then creates a whole network of interoperable blockchains. Interoperability in multiple blockchains not only gives the public options and better innovations and services, but it also enables users to easily share data, transact, exchange, transfer crypto and other crypto assets, as well as present smooth and easy experience for individuals, enterprises and organizations alike.
But in spite of providing blockchains a means to talk and share information, cross-chain relays present a vulnerability risk to the almost impeccable and impenetrable system as the bridges themselves can be areas where highway attacks or heists can happen (i.e. hackers can tamper with transactions or overload the info relayed, making it possible to steal crypto assets). Relays must be improved and strengthened to make it impenetrable and resistant to all hacking attempts.
Other than multichain relays, there is another way to enable users to access different blockchains with using only one digital ID – and it is through web-based domains. Crypto domains may be used as immutable digital IDs like a normal wallet, but it is not limited to one blockchain. Rather than a string of alphanumeric characters for a wallet address, web browser-accessible crypto domains (ending in .crypto, .x, .nft, .bitcoin, .coin, .blockchain, .888 etc.) unique to the users can be their sole identifier for all blockchains. These crypto domains are minted on the blockchain and give the user full ownership and control of their digital identity. They can control who can and cannot view their data.
Domains as digital ID can allow users to log in and transact in crypto and blockchain platforms, apps, wallets, exchanges and marketplaces. Imagine the possibilities further down the line of “Web X.0” through the use of short digital IDs to various blockchains. There can be a future where a user can associate all of their school records, resume, health records, social security number and all other credentials onto their digital IDs. It is safe as people you give access to are the only ones who can view your information.
As exciting as that sounds, that might still be too far beyond in the future. Also when creating digital content and value in the future, users can monetize independently using their digital IDs. This way, they have full ownership of the data and insights of who viewed the content, instead of the current landscape where social media giants hold and use all our data. We need a mindset shift in order for that to happen as we are used to the “free” social media use, let the giants like Facebook and Google find stuff for us, and then monetize our data for their own use. Our personal data has value, and blockchain gives the power over personal data back to its users.
All of the possibilities mentioned above only shows how competition must be kept in the blockchain world and how it can help the industry flourish for the years to come. Without competition and innovation, we might still be stuck experiencing slow and expensive transactions, and a system that cannot keep up with the growing number of users and transaction volumes each year. We think that the future of Web3 and blockchain is composed of a lot of interconnected multichains, with no central chains.
Gigster contributes to the improvement and innovations in the industry through guiding major enterprises and organizations on their way to adopt blockchain technology. With our team of Web3 experts, we help organizations identify the best way they can use Web3 to augment their process and to achieve their goals, aid them in setting up their first Web3 project without trial-and-error, and educate org teams on everything about Web3. Tap Gigster now to get started in that Web3 project – whether to offer something fresh and relevant in the blockchain industry, or to level up your organization.
