Blockchain Platform Technology is still incomplete… Ethereum takes up 60% of the entire platform token market

Block72 and TokenInsight, an independent third-party data analytics organization, together analyzed platform token industry and announced that from last March to September, a number of dApps have been launched on major platforms like Ethereum and EOS, but none of them has been widely successful due to issues related to scalability and security.

In order to overcome this issue, Ethereum is focusing on network optimization, and EOS and Cardano and others are working on strengthening consensus mechanisms and system design. But the platform token market is down and there still is a long way to go. In general, the market value and total turnover trend of platform tokens are similar to those of the overall market.

During the period from March to September this year, the total market value dropped 45.9%, from USD 367.3 billion to USD 1988.8 billion. In the same period, market value of platform tokens also dropped from USD 98 billion to USD 33.1 billion. The decline was even higher at 66.2%.

Likewise, the total transaction fell 42.4% from USD 198.8 billion to USD 11.4 billion. That of platform tokens, which is about a quarter of the total market, dropped as well, from USD 2.6 billion to USD 2.4 billion (7.7%).

Given that the market has plunged in recent months (November to December) after the analysis period, the current index is expected to be worse than this.

As of last September, there are 57 projects classified as platform tokens. Top 10 tokens are in the order of: Ethereum (ETH), EOS (EOS), Cardano (ADA), TRON (TRX), NEO (NEO), Tezos (XTZ), Lisk (LSK), Quantum (QAU), Zilliqa (ZIL), and ICON (ICX).

The first place among them is Ethereum. Ethereum showed a much higher value in terms of market share as well as listed exchanges and dApps. Ethereum accounted for 61% of the total platform market and showed a large gap with the followers: EOS (13.7%), Cardano (6.1%), and TRON (4%). In the entire platform market, these four accounted for a large share of 85%. Regarding the number of dApps on each platform, Ethereum has more than 1,900, while EOS has 130 and NEO 70 as of last September.

These platforms have a diverse range of dApps, from exchanges to games and education, but only few of the dApps have achieved 1,000 DAU (Daily Active Users). Of the top 10 platforms, Cardano, Tezos, Lisk, and Zilliqa do not have any dApps launched on them due to incomplete computing layer and lack of mainnet.

Ethereum also was listed the most, on 222 exchanges, followed by EOS (117), TRON (78), Quantum (64), and Zilliqa (63). Ethereum was the number one player in the top 10 platform tokens in terms of profitability, followed by NEO, TRON, EOS, Cardano, and ICON.

Except for Tezos, the top 10 platform tokens were listed on more than 20 exchanges, and Ethereum, the leading player in the market, was the most traded crypto currency along with Bitcoin. EOS in second place is gaining attention as a next-generation platform and is catching up with Ethereum.

However, even Ethereum’s technology as a platform is incomplete. The top 10 platforms are not meeting the demand from large commercial dApps and their technology is being replaced. Ethereum has adopted Proof of Work (PoW) agreement algorithm since the launch of its mainnet in July 2015, but eventually it is planning to switch to Proof of Stake (PoS) as scalability and security issues are getting in the way of dApp development.

On the other hand, EOS, which launched the mainnet this June, shortened out-of-block time to less than 1 second with aBFT (asynchronous Byzantine Fault Tolerance) based on Delegated Proof of Stake (DPoS). Its current TPS test peaks hover around 4,000, and trading speeds are expected to be in the millions per second range.

Technology of current platform projects is immature and the market is at an early stage. There has not yet been a large commercial dApp. However, the fact that projects are making rapid progress for technological innovation is a positive prospect. Within a few years, as blockchain technology matures, platform projects that surpass Ethereum will appear and lead to commercialization of many dApps.