TL;DR
- Polkadot was conceived and developed in anticipation of Ethereum’s scaling problems.
- While both are open source, decentralized, and proof-of-stake (POS), Ethereum is a layer 1 (L1), stand-alone blockchain, while Polkadot is a layer 0 (L0) blockchain ecosystem.
- Polkadot uses on-chain governance and a forkless upgrade mechanism while Ethereum’s governance is off-chain with a hard-fork upgrade mechanism. Each protocol uses slightly different POS consensus mechanisms.
- Fundamentally, Ethereum is striving for Polkadot’s technology while Polkadot is working for Ethereum’s third-party developer and user-base.
The cryptocurrency market is the freest, fastest, and fiercest on earth. It’s survival of the fittest. A Darwinian death for most with only a handful of projects to emerge as the foundational pillars for a burgeoning Web3 economy. Meanwhile, investors are doing their best to grasp the technology and attempt a prediction about which might be the victors.
Currently, Ethereum and Polkadot hold significant dominance and influence in the market. But these two were competing before both were even invented. That’s because the founders – Vitalik Buterin and Gavin Wood – disagreed over how to best build a platform to handle mass adoption.
This is Ethereum vs Polkadot. A fresh look at two of crypto’s most prominent protocols.
Development History
In The Beginning . . . Vitalik Buterin proposed the Ethereum whitepaper (2013). The innovative idea was decentralized applications (dApps) fueled by smart contracts. Soon after, Buterin assembled his team, which included a guy named Gavin Wood. Ethereum launched in 2015 as a proof-of-work protocol and due to the extreme usefulness of dApps, Ethereum became the second largest crypto by market cap . . . Buterin saw that it was good and rested.
At some point in the timeline above, Gavin Wood foresaw Ethereum’s scalability problems. So he departed for another solution. The Polkadot whitepaper was published in 2016. Wood then launched a foundation and a company, held an ICO, and developed Polkadot. It’s mainnet launch occurred in 2020.
Make no mistake, Polkadot was conceived and designed in response to anticipated scalability problems for Ethereum. And with that in mind, let’s delve into these protocols.
What is Ethereum?
Ethereum is an open source, decentralized, proof of stake (POS), layer one (L1), blockchain protocol. Ethereum’s core innovation is the ability to build and use dApps on the blockchain. And because of dApps, Ethereum’s ecosystem has flourished. Currently, the protocol has over 3,600 dApps, is the second-largest with a $200 billion market cap, and has 20% total market dominance. With these facts in mind, Ethereum can perhaps best be described as a global blockchain protocol that supports an open, evolving, and diverse digital marketplace.
However, don’t let the unicorns fool you, not everything has been sunshines and rainbows. Ethereum suffered serious congestion and exorbitant transaction fees during the 2020 and 2021 crypto bull-run. High user-demand plus limited block space (Ethereum could only handle about 10 to 20 transactions per second) equaled transaction fees, at times, into the hundreds of dollars.
In response, the free market found solutions. Third…
David learned about bitcoin in 2015 and has closely followed the crypto industry since then. His professional interests center around bitcoin, layer-one blockchain protocols, decentralized finance, and clean energy. An attorney by trade, David has held licenses to practice law in the State of Hawaii and in US federal courts.
