China’s state-backed tech workgroup has released its fifteenth blockchain technology assessment with Ethereum ranking in the third position. The ranking takes place after Ethereum Istanbul Hard Fork. China promoted Ethereum (ETH) to second place in the rankings, trading places with Tron (TRX).
2019 was the year of the decentralised finance. 2020 may also be too. Ethereum stands to reduce the risks experienced by the current financial systems. It provides several advantages which traditional financial systems, by nature, do not have. That being said, the volatile nature of cryptocurrencies present several challenges which may not be experienced in the traditional financial system.
It may come as no surprise as Ethereum developers continue to work hard to create solutions to the currency manipulation, failing fiscal policies, and fee-grabbing banking system that many consumers face in different economies. The recent ethereum fork, Istanbul Hard Fork has created several key improvements for the decentralised finance ecosystem including :
1. Interoperability with Zcash (improved privacy)
2. Improved scalability
3. Improve the cybersecurity infrastructure of the platform, making the network more resilient against denial-of-service attacks
4. Improve functions for smart contracts
Ethereum promises to enable over 3000 transactions per second. Projects build the most liquid decentralised finance systems using the ethereum blockchain.
Mason Nystrom, content marketer at the Ethereum incubator ConsenSys says,
“The current financial system is comprised of walled gardens with limited transferability or two-way access. Where interoperability is possible, it’s controlled by middlemen and rent-seekers. Open finance is defined by platforms that can work together with a degree of transparency with functions that complement one another.”
“Various protocols showcase the power of composability: 1)Dharma provides an open platform by 2) leveraging Compound’s open protocol, 3) which predominantly lends and borrows the dai stablecoin created by MakerDAO’s protocol, 4) all on top of Ethereum. Boom.”
The government-sponsored index uses technology, applicability, and creativity as key factors in ranking blockchain projects. It places importance on smart contract platforms. Experts argue that ranking of blockchain projects is exceedingly complex on account of the different natures of cryptocurrencies.
Blockchain technology is becoming an increasingly important tool for the world’s global powers such as China. As the trade and currency competition between the USA and China intensifies, expectations rise for the creation of state-backed digital currencies.
China has expressed growing interest in becoming a dominant force in the blockchain space, pushing for new initiatives that enable it to create and manage solutions in the blockchain industry.