Acting Director of PR for Capedex, and founder and owner of Panda PR & Marketing.
Imagine wanting to move $10 in crypto, and being charged $40 in transaction fees, aka “gas fees”. Imagine being a new artist, and having to pay over $100 to mint your latest [what?] —- And, imagine your surprise when you realize that transaction fees are higher than at your legacy bank?
With the astronomical rise in demand for decentralized finance, decentralized apps (dApps), smart contracts, and NFTs, Ethereum too has grown exponentially.
Unfortunately, with that growth came intense taxation of the Ethereum network, gas fees reaching $30-40 a transaction, and up to $140 to mint an NFT.
To quote Mark Jeffrey in a recent Cryptonized interview, “Ethereum has been claiming it’s going to fix itself and all its problems for years … So these other chains said,
‘Well, you know what we should do? Rip out all the stuff that causes these high gas fees… basically pull out all the bad wiring, … [and] put new wiring in, which makes everything cheap and super fast.”
Thus, Ethereum Virtual Machine (EVM) chains were born.
The EVM is a software-based microprocessor that runs smart contracts and allows them to work together on the Ethereum network. Popular EVMs include Polygon, Fantom, and Binance Smart Chain. Without EVM, the smart contracts dominating the DeFi space would be unable to run. The idea behind the creation of EVM chains being to “Fix Ethereum, don’t wait for Ethereum to fix itself,” says Jeffrey.
Moving smart contracts between the EVM chains and the Ethereum network is done through cloning. You can also send coins through bridges, which are basically exchanges that live on different networks. “These bridges are rising and proliferating very quickly, and being able to move coins is becoming extremely easy,” says Jeffrey.
With the bridges and EVM compatibility, the other chains are becoming massively popular. “Binance Smart Chain quickly rose to about six times the number of transactions of Ethereum itself within a space of months,” adds Jeffrey.
The Binance Smart Chain project was started in September of 2020, and by April of 2021, was worth $30 billion dollars, and is already the home of many projects like Aave and Pancake Swap. Polygon is currently home to around 150 projects, due to its ease of use in creating custom blockchains. Fantom is new to the game, but quickly growing among DeFi and blockchain developers.
To date, no other protocol has come close to the level and adaptation and variety of offerings that are on the EVM chain. Bitcoin does not allow for smart contracts; Nakamoto created merge-mining, which allows side chains to be run on the bitcoin blockchain, which could theoretically allow for DeFi and smart contracts, but it never took off in a major way. Bitcoin has long been considered “digital gold”, and Ethereum and EVM chains have stepped up to fill the gap in utility.
There are multiple blockchain virtual machines, but the beauty of EVM is the universal language used, allowing other projects to transplant the language and have it working quickly. It will be interesting to see what happens with these other chains, as the ease of access to development and innovation broadens.
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