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Should the smart contract platform be EVM compatible? How to balance?

Messari

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Of TVL's top 10 smart contract platforms, 70% are EVM compatible and 30% are not.

EVM Compatibility? That's the question

Ramshreyas Rao, Analyst at Messari

原文编译：Unitimes

First there was a scramble for DeFi liquidity, then an NFTs mania --Are we now in the midst of a Cambrian explosion of smart contract platforms?The price increases of Solana, Cardano, Polkadot, Terra and Avalanche, as well as the excitement surrounding the launch of Ethereum L2 scalable solutions such as Arbitrum and Optimism, support this view.

However, as Ryan Watkins, an analyst at Messari, wrote in a recent post on"Smart contract platform wars"Price is not everything. As shown in the figure below, with TVL As measured by total lock-in value, the actual activity of these platforms is comparable to that of Polygon and others compatible with EVMThe etheric fangSide chainThat's a long way off, and Polgyon's prices are a fraction of those of its new competitors.

Top 10 smart contract platforms by total lock-up value (TVL) as of September 27, 2021 & NBSP;

Like & have spentBSC (Binance Intelligent chain) and &NBSP;Polygon How does this relatively high market cap side chain of Ethereum strongly sustain "real" use cases? A new comer.Arbitrum How did he quickly break into the top 10 in TVL (total lock-up value)? What do they have in common?

Above: EvM-compatible platform (left)& NBSP among TVL's top 10 smart contract platforms; And platforms incompatible with EVM (right).

Of TVL's top 10 smart contract platforms at the time of writing,70% of platforms are EVM compatible and 30% are not! EVM is a "virtual machine" that runs smart contracts, originally on Ethereum and now compatible on a range of emerging Ethereum side chains and L2s networks.You can think of EVM as NBSP;Android operating system & NBSP;-- Android phones (Google phones and other Android phones) can run some of your favorite Apps. Why is this detail important when evaluating smart contract platforms? Who cares?

Developers care!As Steve Ballmer (Former CEO and President of Microsoft) As he warned us,Developers are the key to success. If you're building a blockchain platform, your initial audience is the developer -- they'll be responsible for creating the appeal (great experiences, apps, use cases, etc.) that brings users to the platform.This makes platform choice a key variable that developers need to consider from the start.

The platform wars are about developers first and users second.

That would explain a lot of things. When we look again at TVL's top 10 platforms, this time with their respectiveTop ecosystem dApps Taking this into account, we can get the following chart:

Above: EVM-compatible platforms (left) and evM-incompatible platforms (right) among TVL's top 10 smart contract platforms. Their top ecosystem dApps. Drawing: Messari

The table above seems to suggest that if you choose not to be EVM compliant when building a new smart contract platform, you are doomed to fragmentation. In contrast, emerging smart contract platforms clearly can if they choose to go evM-compliantGet an existing top-level DeFi project, and the users who use these DeFi projects.As far as evM-incompatible chains are concerned, no matter how exciting they look, they must start from scratch building new projects or cloning other products and avoid the network effects and momentum of other older DeFi products. Which brings us to our next question:In the long run,How many types of smart contract platforms will the market support?

There can only be two.

Apple vs Microsoft, Android vs iOS, Chrome vs Firefox, Java vs Net, AWS vs Azure, Intel vs AMD, Nvidia vs AMD... If you look at the technology stack across domains, you'll see a common pattern: there are many end-user products/applications, butTechnology platforms tend to be inThe state of a "duopoly" :

Obviously, we are now in the smart contract platform shown in the figure below"Before"Phase, there are a number of potential solutions (including EVM, Polkadot Substrate, Solana WASM, etc., as shown in the figure below). But how long before there is a merger? If a merger does occur, can we really imagine a future in which EVM is not one of the "heads" of a duopoly?

Those smart contract platforms that are not EVM compatible reallyJust competing to be one of the "heads" of a duopoly?Let's extend that metaphor and look at it.Windows vs. Mac operating systems. Windows is the operating system used by many original device manufacturers (OEMs) in their products, while MacOS is only used by Apple on its own computers. This is no different from the blockchain space -- each smart contract platform is essentially a giant distributed computer. Some blockchain platforms (like OEMs) use EVM as their operating system, while others prefer to use their own custom virtual machines. Like the computer operating system wars, this virtual machine design choice has a big impact.

DApps developers (Most developers work in small teams) are less likely to be able to target a long list of VIRTUAL machine types, they are more likely to target the number one and two virtual machine types in the market, and their integration of their dApps into a small chain is a low priority. When choosing evM-compatible or EMV-incompatible virtual machine types, they may be based on a "blue ocean versus red ocean strategy," either competing in a highly competitive EVM ecosystem,Or opt for product cloning extension and differentiation in a growing non-EVM ecosystem and hope that it will win out in the long run.

One example is a decentralized exchange called Serum, built on Solana (not EVM compatible). Although the standard DEX (decentralized exchange) model in the EVM world uses liquidity poolsAutomated Market Maker (AMM) model However, Serum takes advantage of the speed and low cost environment of the Solana chain to create a DEX with a central Limit Order book (CLOB) model that allows the ability to build a completely different set of dApps applications on top of it, but at the expense of interoperability with other EVM-based applications.

Until there is a clear competitor to EVM, this pattern on Serum seems likely to continue: This is a battle between dApps deployed on the EVM chain and evM-incompatible island platforms (so called because these evM-incompatible platforms only manage their own dApps). So, do you decide to choose EVM, or not?

Figure above: Advantages and disadvantages of EVM-compatible smart contract platforms compared with those that are not.

As shown in the figure above, the advantages and disadvantages of evM-compatible smart contract platforms are as follows:

Advantage:

- Existing experienced users can migrate over;

- Inherits existing dApps;

- Higher technology maturity;

- Easier interoperability with the Ethereum ecosystem, known as "network effects".

Disadvantage:

- Capital flows are easy because the cost of converting capital is low;

- Bound by the Ethereum roadmap, which may interfere with your release plans;

- Innovation is constrained by EVM rules.

In contrast, the advantages and disadvantages of evM-incompatible smart contract platforms are as follows:

Advantage:

- Can implement differentiated functions (such as Serum);

- Create "lock effect" on existing users;

- Independent of the Ethereum Roadmap;

Disadvantage:

- Barriers to entry for developers: need to use a new language/framework/development environment;

- User barriers to entry: the need to use a new wallet/interface/application;

- Need to grow user base from scratch;

- Reduced network effects due to isolated island status -- cross-chain DeFi composability;

Based on the above information, this gives us a potential framework to evaluate the most exciting EVM and non-EVM projects.

EVM entry & universe have spent

Figure above: Cost, TPS, incentive/attraction comparison of EVM smart contract platforms.

Evm-based Ethereum side chains, Rollups, and other L1s public chains are all essentially competing for the same dApps and users.Capital flows quickly, and if users can reap the benefits, the new EVM compatible chain will be enthusiastically adopted.But as long as the pie is growing, it may not be a zero-sum game.The industry is still young, and as long as the EVM compatible chain can be competitive in terms of cost and performance, while providing an incentive for users to bring in and stay, it is likely to survive.

Differentiation is a delicate thing in the EVM universe: Ethereum Rollups claims to have a better degree of decentralization than other EVM-compatible L1s public chains, but the market has yet to price it at a premium. As more interoperability protocols come online, there is a lot of potential for cross-platform architecture. For example, providing collateral on one EVM compatible chain and lending on another would extend the availability of the entire economy.It is likely to be an open market, multiple platforms compete for users' attention -- much like the Windows PC market.

Platforms not compatible with EVM

Above: The difference, incentive/attraction comparison between the major EVM-incompatible smart contract platforms.

In stark contrast,Evm-incompatible platforms need to offer modes that are significantly different from ethereum modesAnd also needIncrease its user base from scratch. These projects willYou have to argue whyThey have the best smart contract or execution environment and use incentive programs and funding to drive adoptionArbitrum based on EVM does not need to do so to achieve exponential growth.

While these EVM-incompatible platforms may be evolving in a less crowded field, they may be fighting an uphill battle for head position. It's hard to imagine dApps developers, users, or even the most innovative wallet companies successfully dealing with so many different (evM-incompatible) platformsDifferent development languages, architectures, update schedules and roadmaps.

According to this argument,The non-EVM space seems likely to emerge as a winner, absorbing most of the non-EVM user base"And repeat the" duopoly "model we've seen time and again. It is likely to turn out to be a battle for execution and funding -- perhaps to the advantage of older, established projects. However, another way forward for these platforms is to become application-specific chains: Terra As an example, the chain focuses on building use cases around its native stablecoins.

Write at the end.

When evaluating a smart contract platform, it is useful to first determine whether the platform is EVM compatible. This allows us to view its prospects in terms of "blue ocean strategy versus red Sea strategy".Evm-based platforms compete on cost, performance, and incentive plans, while evM-incompatible solutions venture into uncharted territory with highly differentiated products.

Both strategies can be successful, as newcomers Solana and Arbitrum have recently demonstrated. The pattern of smart contracts is set to continueoligopolyThe form of existence, or to the intenseduopolyTransition will be an important pattern worth paying attention to in the coming years.