What is Ecosystem in Crypto? Why does every Blockchain need an ecosystem?
What is Ecosystem in Crypto? How important is the ecosystem? Why does each Blockchain need to have its own ecosystem? Find out here.
Ecosystem is a term that has been mentioned a lot in recent times. This article will help you better understand:
- Definition of an Ecosystem in Crypto?
- Why does a Blockchain need an ecosystem to grow?
Definition of ecosystem in different fields
What is an ecosystem in nature?
An ecosystem in nature is a complete open system consisting of living components (biomes) and non-living components such as air, water and mineral soils (collectively referred to as habitats).
What is an ecosystem in business?
A business ecosystem is a value chain system consisting of many interconnected products in a certain business area.
Apple’s ecosystem, including a value chain in the technology industry, from phones, tablets, headphones, watches,…
Meaning of ecosystem in business
It is no coincidence that all major business empires today want to build their own ecosystems. It will bring many benefits to both the user and the company:
- An ecosystem that will fully serve all their needs.
- Products in an ecosystem will be synchronized and interacted with each other, creating convenience and ease of use.
With the project:
- The ecosystem will help the project expand its business scale and build the company’s value chain, from input to output.
- Take advantage of existing pieces such as infrastructure, data from users, …
In particular, when the project has developed a full ecosystem, users will stay with them forever, they do not need or need to use anything outside that ecosystem. Once it has users, the company has more Insights, through which it can improve and continue to expand its ecosystem.
Here I take the example of the Apple ecosystem, with products including: iPhone, iPad, iMac, MacBook, Apple Watch, AirPods, Apple TV.
As can be seen, Apple has developed a full range of products, serving most of the needs of technology users, from phones, tablets, headphones, watches, TVs,…
These products all run on iOS operating system and are connected to iCloud, thanks to all these products having the ability to interact with each other, users using 1 product can manage data in the products. is different.
Therefore, users who have used Apple products will tend to only use its products, because changing to another company will be very inconvenient.
Thereby, Apple has developed a complete and interconnected ecosystem, Apple users do not need to use another company because Apple has provided a full range of products to serve user needs.
If another competitor wants to compete with Apple, they cannot compete with one product and need to build an entire ecosystem, which is very difficult.
What is Ecosystem in Crypto?
Similarly, the ecosystem in Crypto is a system of many products that connect and support each other inside a Blockchain, each Blockchain is now like a company providing infrastructure, they will also want to develop a full ecosystem of themselves.
The main pieces to complete an ecosystem in Crypto will be:
- Transactions & Payment Services: The most basic need of a Blockchain is transactions and payments. The small pieces inside will include: Token, Smart contracts, Wallet.
- DeFi: This is the most centralized piece of the puzzle today, most Blockchains are trying to fully develop this puzzle, DeFi provides users with the needs of transactions, loans, loans, savings, etc. .. without a 3rd party intermediary. The main components of DeFi will include Stablecoin, DEX, Lending/Borrowing, Synthetic,…
- Social, Entertainment: The next demand will be community interaction and entertainment, the current main components in this segment are NFT, Games, Gambling,…
- Enterprise blockchain solutions: Finally, the applications of Blockchain in practice, in a number of fields such as Finance, Supply Chain, Healthcare, Education,…
Outstanding Ecosystems in Crypto Today
Currently, there are many ecosystems in Crypto, idolmeta.net has evaluated the systems, you listen and re-read here to understand the current situation of the systems.
In general, current blockchains are divided into 3 main tiers:
- Top Tier 1: Including Ethereum and BSC, these are the two current large ecosystems, have fully integrated the pieces and we will use that as a standard to compare other small projects.
- Top Tier 2: Including Solana, Avalanche and Polkadot, full of potential ecosystems but still lacking a few joints to develop fully.
- Top Tier 3: Very new ecosystems, almost nothing, including Near, Cardano, Dfinity.
Solana Ecosystem: Missing pieces of the Lending puzzle in DeFi.
Polkadot Ecosystem: The core part of infrastructure is not completed, although it is full of puzzle pieces.
Cardano Ecosystem: There are still many pieces like Stablecoin, Lending, Synthetic. The number of projects is still quite small.
Investment opportunities in ecosystems
idolmeta.net mentions a lot of the term ecosystem recently, because when the game started to develop to many Chains, a strong ecosystem was the weapon for Chains to compete with.
Only those Blockchains that fully develop the necessary pieces, fully serve the needs of users and retain users, will be the ultimate winners.
Opportunities also come to incomplete Blockchains, investing in the missing pieces is also a strategy that many people apply today.
Since Ethereum became overloaded and opportunities came to other Blockchains, the battle between Blockchains has become very fierce, Blockchains compete with each other from users, cash flow, even projects, everyone wants build an ecosystem for yourself.
Above is an article explaining the Ecosystem in Crypto and why each Blockchain needs to have its own ecosystem when developing. Which ecosystem are you most interested in? Please leave your comments in the comment section so that we can exchange and discuss.
Good luck with your investments.