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Coleman Maher is responsible for partnerships at Origin Protocol, a blockchain platform for peer-to-peer markets. You can follow him on Twitter @colemansmaher.
The following is an exclusive contribution to the year 2018 of CoinDesk.
The two most popular crypto commentators in 2018 were "The Flock Comes" and a call for "mainstream adoption".
The forecasters have openly speculated on the impact that institutional investors would have on the value of the cryptographic badets in their portfolios. While we witnessed the launch of Bitcoin Futures, Yale's venture capital boom and capital endowment that invests in crypto-investment, prices have gone down, not up. We are still waiting for this flock.
However, it can be argued that retailers' speculation on cryptographic badets has already reached a certain level of traditional adoption, as evidenced by the constant media coverage of CNBC and Bloomberg and markets like Square Cash, Robinhood and Coinbase. According to the researcher you are asking, soaring cryptography prices in late 2017 and early 2018 have been largely fueled by retail investors and enthusiastic investors.
On the other hand, in the burgeoning space of decentralized applications, the debate on "traditional adoption" is focused on improvements to the SAD and the user experience. I must say that things are not going well. Usage figures are pitifully low and the user experiences on offer are generally terrible. The dapp space has been filled with questionable ICOs, scams and useless tokens that have lost almost all their value.
The prophesied point of inflection of "mainstream adoption" for dapps seems incredibly distant. However, I would say that this foam level is predictable and that it is far too early for "traditional adoption" to be a reasonable indicator of success for dapps.
Building blocks
It was an important year for the construction of dapp. There has been an impressive number of wins in development, even though the number of users does not match that.
We witnessed the exit of the Augur forecast market, the first ICO ever built for an Ethereum-based application, after three years of development. Although it is not a pleasure to use (for the moment), it represents a remarkable technical feat. Augur saw a significant amount of users, open interests and open markets after launch. This activity quickly fell, as commentators have pointed out, but the mid-term elections in the United States have been a bright spot for Augur.
Augur has invested more than $ 1 million in this market, compared with about $ 550,000 on PredictIt, the leading centralized prediction market. Goleum and Aragon were also put online on the main network in 2018. 0x and MakerDAO saw their adoption and activity grow, with several relays being successfully launched and 1% of all the ether being blocked as collateral issue of Dai stablec parts.
Decentralized exchanges such as IDEX and ForkDelta have resulted in considerable growth in the number of users and the volume of trade.
Gnosis launched his DEX based on a "slow.trade" auction. Status, a decentralized messaging platform, has been upgraded to beta, allowing Mainnet to run by default. Spankchain, Connext and Liquidity Network have launched public channel payments on Ethereum, paving the way for cheaper and faster payments for dapps. Loom Network launched Plasma.
Sidechains cash for his suite of games and dapps. The peer-to-peer dapp market of my own company has also been put online on the main network.
In the world of bitcoin, the Lightning Network has seen a significant increase in the number of nodes and channels. The list of Lightning applications is expanding. The Blockstack platform now supports dozens of applications, including Graphite, a decentralized alternative to Google Docs.
Behavior of the bubble
Many processing technologies have been accompanied by speculative bubbles, ranging from railroads to petroleum to electricity via the Internet. Frantic investors have invested money in dubious programs, "oversubscribed" for hundreds of years.
Long after the bursting of these bubbles, primordial companies, such as Union Pacific, emerged from it: the descendants of Standard Oil, (Edison) General Electric and Amazon, remain giants.
There is a common denominator in all of this. Speculators wait too much, too fast, bad actors rush to take advantage, the sour people of technology after market crashes, and this underlying technology ends up profoundly changing the world – even if it does not make every impatient speculator rich. .
I've been exposed to a wide variety of blockchain projects and founders because of my role in managing partnerships for a blockchain platform company. Earlier this year, the crypto bull market and the ICO craze created a perverse incentive environment. Short-term greed and FOMO ruled. Many projects focused solely on fundraising and marketing.
There were even rumors that some projects acted as unregulated hedge funds, investing corporate money in the companies of their friends. The extreme appreciation of prices has inflated a lot of ego. A lack of sound cash management and total disregard for securities laws were extremely common. We are seeing some of the consequences of our inability to self-regulate now, with the reinforcement of the application of SEC rules and the closure of projects that caused a lot of enthusiasm because of the downfall of their 90% war chest.
All of this is detrimental to long-term growth. The sooner we get rid of this behavior, the better.
Beyond the bubble
It should be borne in mind that we are competing with the traditional Internet, computer applications and financial infrastructure, while trying to launch a large, fragile economic experience.
Let's not forget that it took decades for cars and tractors to overtake horses. This may seem surprising today, but if you consider that the first drivers have had to deal with a total lack of support infrastructure, it becomes easier to understand. I would recall that the current state of the blockchain was prior to the beginning of the boom of the Internet bubble, locating us in the 1980s rather than the 1990s. We are still in a construction phase of 39; infrastructure.
We are not ready for traditional adoption. Everyone knows that "layer one" public block chains must absolutely evolve. Developers face the current limitations of the blockchain and shift their focus to Layer 2 and off-line solutions.
I predict that we will increasingly see the terms "Web3" and "Decentralized Web" in 2019. Another major long-term challenge in the field of dapps is that we do not yet have a proven business model for chip tokens. dapp. Many purchase tokens that have been good investments suffer from questionable economic design.
Even the dominant discourses on bitcoin and the ether – bitcoin being a store of value close to digital gold, and the ether paying for the gas needed to use a decentralized global computer – are not universally accepted by researchers.
Projects will have to consistently demonstrate that a model that supports the price of their token is based on utility rather than speculation. A dapp token claiming to be like Bitcoin's Golden Gas or Digital Ether should be subject to extreme scrutiny. Tokens have
tremendous potential for encouraging growth and good behavior. We must understand that.
The good news is that there are tons of smart and motivated people working quietly on all these issues. Testing new business models and improving the multi-billion dollar basic infrastructure takes time.
Be patient
Finally, we must learn to separate price movements from underlying fundamentals. High prices do not mean that a blockchain revolution is imminent and low prices do not mean that technology is doomed to failure. Things will not look like what we expected when everyone was drunk 100 times, at least not soon.
This technology will take some time to mature, but the underlying fundamentals are strong.
The number of Ethereum smart contract calculations is almost identical to that of the beginning of the year, when prices reached unprecedented highs. This year, hundreds of thousands of GitHub are committed to blocking projects and downloading development tools. Blockchain offers open platforms with innovative economic incentives for developers, who will win their hearts and minds in the long run.
A group of builders is coming, laying the foundation for adoption by the general public in the future. When this point of inflection reaches, it will be extremely disturbing. There will be applications and use cases that we have never dreamed of. The world will be transformed by blockchain technology and decentralization.
We just need a little patience.
Line at Apple Store via Shutterstock
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