Virtual Machine Wars (25)— competition for the web 3.0 economy
Blockchain Virtual Machine (s)
Cryptoken Board UÜ Strategies team, continues with our efforts publishing a best in class and bespoke crypto research, this time focusing on analyses covering the layer 1 blockchain virtual machines, and its fundamentals. For the past couple of years, crypto saw a myriad of new chains being launched across multiple of networks, with each iteration improving on the Bitcoin tech stack. Blockchain virtual machines are designed with specifications, smart contract architecture, road-map and vision, programming language and their web 3.0 design. With this article, CB team wants to provide a comprahansive overview of the BVM space, and provide research on the leading networks and their specifications.
Right after the advent of Bitcoin, a wave of new blockchain protocols ensued, roughly after 2018 boom market, Venture Capital teams started working with various labs companies, what might turn out to be Virtual Machine Wars — competition for the web 3.0 economy. Ethereum lead with smart contract standard ERC20 ERC721 ERC1155 and others, which by an order of magnitude improved on the basic functionalities of the UTXO [ unspent transaction output ] value-transfer of the BTC.
The so-called Blockchain Virtual Machines or BVMs for short, set sights on augmenting Bitcoin architecture by enabling Turning-Complete propagation of code, built-in modules execution and transfer of additional data inputs, peer to peer.
With this research piece, we are providing a two prong analysis, one focusing on the capital market aspects of the BVMs under coverage, and second a more fundamental topic reporting on qualitative information. In the second section we will cover data BVM consensus / type / programming language, scalability, and monetary costs. This article will provide analysis on the 25 top leading BVMs ranked by market capitalization.
In addition to reporting on topology classification (provided by Cryptoken Board UÜ) that outlines how each blockchain is categorized by industry and sector classification, we added comparable metrics or “comps” to help with this relative study. Please refer to our previous publication learn more about our blockchain topology and the classification index (indices) — here.
A topology study of blockchains, remains a very much neglected topic in our industry, in our humble opinion. So our team strives on continually update and maintain relevant database for the top 500 chains organized by market capitalization, an index we refer to as Global Investable Market 500 or GIM500. Therefore, criteria for each virtual machine smart contract platform according to CB classification falls under this specific category:
INDUSTRY (2) infrastructure
SECTOR (5) smart contract platform
For more information on the topology of blockchains, contact our team. The Chart #1 below displays all BVM chains organized by their market capitalization ranking and financial data on CoinGecko.
Some really interesting takeaways here, as we can tell Ethereum blockchain is leading the market capitalization ranking, falling second only to Bitcoin. ETH continues to dominate the market in terms of both dollar valuation (outstanding token market supply) and other decentralized finance investment metrics like total value locked and earned fee rewards.
The Chart # 2 looks at the same 25 blockchain under coverage, but break down BCM market dominance, with Ethereum leading the BVM market with a significant 78% share, when including the top 300 BVMs by market capitalization. On the y-axis we charted market cap dominance, and on the x-axis blockchain virtual machine name and its market rank.
Now, we’d like to present in this next section fundamental analysis, categorically organized by the leading BVM chains but instead of focusing on financial data, we want to present discrete features of each blockchain. In this section, that we dubbed “programming the future” — virtual machine wars have officially started as most of the web 3.0 applications are built, well via blockchain! The goal is to highlight the main features and characteristics of each BVM tech-stack, their component, performance, by looking deeper into fundamentals and their web 3.0 chain infrastructure.
Programming The Future
The following section, will summarize each blockchain, along with their respective tech-stack fundamentals, on-chain consensus mechanism, programming languages (s) deployed, type of processing, method of execution, scalability and the relative cost of smart contracts. Each blockchain is organized by their name, and ticker. The Chart #3 includes a comprehensive list of the blockchain virtual machines ranked by market capitalization found in our GIM300 list, organized by classification it being CATEGORY (infrastructure) and SECTOR (smart contract platforms).
Ethereum, Cardano, Polkadot, Solana, Tron, Ether Classic, Aptos, Hedera, Internet Computer, NEAR Protocol, EOS, Tezos, Mina Protocol, Stacks, NEO, Ether Proof of Work, Casper Network, NEM, Qtum, Waves, ICON, Ontology, Lisk, Agoric and Aelf are included on this list, one notable omission is the SUI blockchain that was launched in Q2 of 2023.
We can tell that unlike Bitcoin, blockchain that reaches node distribution and market consensus via Proof Of Work mechanism, where miners calculate hash of the new blocks by using the SHA-256 algorithm. Blockchain Virtual Machine blockchains rely predominantly on a variation of toke staking mechanism for node validation, processing the on-chain transactions via a different Proof of Stake method. This guarantees more energy efficient block propagation and security, while keeping transaction speeds and confirmation times fast.
From the next list — we are reporting BVM consensus mechanisms by their type. We can see there are a a bunch of unique consensus mechanisms in the BVM space = starting with Ethereum / Qtum (Proof of Stake), Polkadot (Nominated PoS), Solana (Proof of History), Aptos (using a new programming mechanism developed for Meta developed for Diem — a blockchain project funded by Meta (Facebook)). When the Diem project was sold to Silvergate Network in March 2022, a group of former Diem engineers went their own way to create Aptos. The Chart #4 reports on the entire 25 BVMs comparing the entire market place. For instance Waves blockchain uses something called Leased Proof of Stake, while some others have Delegated Proof of Stake (TRON, ICON, LISK, AELF) use a method of delegating digital asset to a super staker, node responsible for reaching market consensus.
The next table shows Chart #5, a unique BVMs programming languages used for code compiler, and TX execution. The ETH based smart contracts are based on Solidity, while we have many multi-language platforms that deploy Rust + Javascript (Polkadot, Near, Lisk, Algoric, Hedera).
Finally, and the last we have Chart #6 organized by Type and Methods of execution (might require blockchain technicians with expertise in computer programming, to corroborate we would welcome feed back from the community, making a best effort to outlines that in certain cases like Ethereum). Both Type and Method of execution is analyzed here on the best effort basis, we’re starting with ETH that’s gas fee based model called GWEI, and execution of smart contracts are guaranteed however costs on ETH are not deterministic, meaning their fee structure depends on complexity of the token programming. We highlight here that some other blockchains, might solve this issue by covering both the processing of smart contracts and account storage, while others might rely on parachains, for interoperability. Also in some cases like with TRON, developer have an ability to freeze or assign a wallet, to each each smart contract deliverable reducing the gas fees — please review below for entire list!
Account method by which smart contracts are executed on a blockchain virtual machines also differs from chain to chain, and for instance QTUM / Stacks are built on top of Bitcoin mainframe, utilizing UTXO + account abstraction — uses an account abstraction layer to decouple applications from the underlying protocol (this maintains the performance of the blockchain and creates the ability to add more smart contract capabilities in the future). Some other BVMs are relying on Super Delegates, some on Super Charged Rewards, Delegate Nodes, Super Delgates Nodes, GOSSIP, and Super Represntative. The goal of this paper is to introduce Type and Method of contract execution, and report on bandwidt hof each chain from scalability point of view. The range of transactions per second is anywhere between 25 TPS to up to 50,000 TPS or even 100,000 TPS. As we can see we have a heat map, in the last colum here that ranks relative affordabiltiy from low, medium, high and super high cost expense. Ethereum is the most expensive network in the crypto universe.
We welcome to community to engage on this topic, peer review and share their thoughts as our goal at Cryptoken Board UÜ is to encourage more conversation, focusing on topology of blockchains and their respective dominion. This is an eleventh article we have published, and we really enjoy producing content meant for the entire community, please note the above list of L1 BVMs is not exhaustive, but it outlines a classification index according to our topology classification. Make sure to share / like and comment letting us know your thoughts and as always we welcome constructive criticism and feedback
If you would like to make a contribution to Cryptoken Board UÜ research desk to help us continue to publish best in class reporting — via:
BTC address: 15DvCYNZ9CKYa5U4P7x9dCQYXsEw8BTb2q
LTC address: LSegtjuDRyp6wVmQ2JLAkp3JWBZGt23Zqe
Contact
email cryptoken_board@pm.me
Twitter
https://twitter.com/cryptoken_board
