Ethereum is one of the most innovative technologies on the market, as it introduced the concept of smart contracts and decentralized apps in a world that’s not ready to accept decentralization. The blockchain was created to be more than Bitcoin, and it fulfilled the objective, as it differs considerably from the first crypto store of value.
On the other hand, according to Binance, the price of Ethereum and its value remained relatively stable but shy of reaching Bitcoin’s market capitalization. In comparison, it may seem like Ethereum is far behind, but the truth is it excels in another area of development.
The Ethereum blockchain could change how companies handle their data systems and organize information based on decentralization and transparency. As simple as it sounds, this technology could spur innovation and increase the chances of hiring talent within a business. So, let’s see what are its best use cases.
Ethereum is a unique ecosystem for businesses
Ethereum became an excellent solution for companies, leading to the creation of Enterprise Ethereum, a customized environment in which private corporations and companies can leverage permissionless features to control their architecture and customer information.
The biggest ecosystem that comprises essential companies like the Samsung Group or Microsoft is called the Enterprise Ethereum Alliance (EEA), in which they hold private sessions for experimenting with Ethereum and blockchain. Many of these businesses already leverage some of Ethereum’s features in the real world in either banking or shipping, showing its benefits for current economic and financial systems.
Ethereum holds the base for decentralized finance
Global finance has its challenges. In some areas, it’s not available to the population. In contrast, in others, it takes advantage of the poor conditions in the country and thrives on people’s and organization’s lack of awareness and education.
Here’s where decentralized finance comes into question and poses a better version of traditional finance. The Ethereum-based technology includes the creation of financial products and services based on decentralization and features of immutability and censorship-resistance.
Some of these DeFi platforms ensure P2P borrowing and lending and offer access to decentralized exchange mechanisms and stablecoins. Hence, they provide ease of access for those who want fast and equal rights for innovative financial products.
Ethereum ensures easy NFT creation
NFTs (non-fungible tokens) are emerging in investors’ portfolios, as their value is given by the ownership state and the number of communities engaging with them. These assets are highly appreciated in sectors like gaming and art, where fans can engage with their influencers or social media models by buying their NFTs.
Since the CryptoKitties NFT collection and Bored Ape, the NFT industry changed considerably as everything can be transformed into such assets and exchanged in marketplaces and within online communities.
Numerous luxury brands approached NFTs as a way to expand their reach to new customers and prove their uniqueness and openness to technologization. They’ve displayed clothing NFTs recently to appeal to the young generation, which doesn’t mean they’re shifting businesses but instead are willing to try new things.
Ethereum offers decentralized autonomous organizations
Using DAOs for your business is a great way to communicate better in regard to voting, improvement decisions and income spending. It’s already been used by companies as DAOs offer all the tools through automatization and decentralization for users to reach an agreement without unnecessary involvement from one of the parties.
These blockchain-based technologies work without a central authority, giving each participant the responsibility of contributing to the network. The rules and guidelines in these ecosystems are coded in software, while the stakeholder community helps with administrative decisions.
Why should companies use these Ethereum tools?
The lack of innovation in the past years is setting the levels of competitiveness to the sky as businesses struggle to improve organizations considering the current global disputes. The lack of talent, products and manufacturing processes can be overwhelming, significantly when customer requirements are constantly changing, and sustainability trends are on the rise.
That’s why leveraging Ethereum tools in a world where hacks are prominent is best. Numerous companies have to pay the price of no data safety, which decreases their income and brand trust, which sets them back considerably, allowing other businesses to reach their place on the market.
However, using Ethereum should be done more often by emerging companies because taking advantage of smart contract automatization or DAO voting governance has much more benefits than it seems. That’s because systems can be better protected and organized through decentralization and immutability, while collaborators can work more efficiently with companies.
Many corporations, such as PayPal, are working with Ethereum developers to seek more opportunities for development. Considering that no other unique financial service is on the rise at the moment, cryptocurrencies and blockchain are leading the market, as uncertain or risky as it is.
Still, Ethereum needs improvement
Despite being an essential tool for developers, Ethereum has some issues that must be addressed in time to avoid risks. For instance, its scalability struggle is prominent even after the Merge, a critical development of the network that lowered energy consumption and introduced staking. At the same time, the centralization risks are lurking around due to stake distribution where only a few companies rule the network of Ethereum.
While these aspects don’t seem to be of much importance to developers, the way the blockchain evolves allows them to be more accessible in their creations or not. If the network isn’t easily scalable, transactions cost too much, and they’re time-consuming, which hinders their process of getting all the technologies and supplies for Dapps and NFTs. At the same time, centralization may pose a significant risk to decentralization and fairness regarding the correct incentivization.
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Final considerations
The Ethereum blockchain is a superior tool that can introduce the next generation of technology into traditional systems, as it provides automated contracts, decentralized apps and communities where each user contributes to the network and gets rewarded. The ecosystem ensures a multitude of tools available for anyone interested in building high-tech products and services. Still, since it’s an emerging technology, Ethereum must mitigate issues in regard to scalability and centralization.
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