What it means to be part of the Ethereum ecosystem.
As time goes on it's becoming clear that many of the planned Ethereum killers haven't yet been successful at killing ETH. Some projects still believe in the imminent ETH demise, others have become a second layer solution and other's still believe ETH 2.0 will fix a number of the scaling problems. If you are not familiar with ETH 2.0 I wrote a brief TL;DR that you can check out here. Being your own chain can be, and is for those that do it successfully, very powerful. Don't get me wrong, this is not meant as a slight to those projects that are making it, they are important projects and having their own chain makes sense for their use case. I want to see a diverse cryptoverse with options, I don't support widespread consolidation. But it is really hard to establish your own ecosystem, woo developers, onboard users and dapps and everything needed to make it work. Then you need to convince exchanges to build a wallet and integration for your chain as well as any other 3rd party wallets or anything else you want to work with out there. Kudos to the chains that have done this successfully. But if your project doesn't absolutely need it's own chain to meet its goals, you can be a successful project without doing that all as well. What a lot of people don't necessarily acknowledge is how powerful it has become to actually be a part of the ETH ecosystem. ETH is not just a coin for trading, but a massive world has been built upon the Ethereum network and being part of that world opens up a lot of possibilities. Being on Ethereum opens a lot of doors just by the fact that you are on the chain. It clears a lot of hurdles you would have to fund for yourself if your project goes it alone. Some of these things are obvious, like explorers and wallets. You don't have to build them. You launch and you immediately have access to a wide array of explorers for ETH as well as most wallets that can add a token with a simple contract address. Words like etherscan and metamask and ledger have become ubiquitous in the crypto world. Almost nobody has to ask what those things are or what they do, they just are, and (almost) everyone knows it. You don't have to spend your projects capital and time resources building an explorer or a soft wallet or trying to get on hardware wallets. That time and money can be put into your project.
What about the other things that are a little more behind the curtain. If you are a mining or staking chain, depending on your consensus protocol, and depending on how the chain works this can mean any number of things. You have to find a way to fund and maintain the chain, do upgrades, pay for servers and load balancers and RPCs and a whole bunch of things. Yes, some computing power is required for tokens as well, especially if they have a complex thing they are doing like an exchange. But they don't have the added cost and time expense of keeping a chain running. Again, this time and effort can go into the project and help to make it more likely to succeed.
But what is next? What about getting on popular sites where dapps are reviewed? If you are an Ethereum project it's no problem to get up on something like State of the Dapps. Ethereum is already their biggest list, you don't have to convince them to add your chain. Same can be said for staking websites. Really anything talking about Ethereum. You make things easier all around for exposure to the most used resources. This is very helpful especially if your project has a budget. You have easier access to exposure without having to convince them to integrate a new chain. Exchanges, this is a big one. First off you have centralized exchanges, it is loads harder to get a centralized exchange to integrate a new chain. Not only convincing them, but then paying them for the integration. Spending your time and project resources working through that integration and the testing. Oh, and say you want to work with a liquidity provider or woo a bot trader to do arbitrage across exchanges, now they may have to work on cross chain liquidity. But there are a host of projects on Ethereum already that provide trading for tokens. There are ERC-20 liquidity networks. There are some decentralized exchanges and swap services out there that users can add tokens to themselves. There are some simple ETH smart contract swaps out there that are non-kyc and all you need is your token contract address and you are off and running. I even read about a smart contract fiat gateway on the Ethereum network that is essentially a smart contract escrow service. So your project can immediately have decentralized non-KYC fiat integration. Another big one is DeFi. The DeFi services run the gambit as well. There are larger well known DeFi providers with custodial wallets and KYC, and those for sure will be hard to crack. There are other DeFi projects with a DAO, these also might be a little tougher to get listed, but you have a chance. But being on Ethereum, the current established frontrunner for DeFi gets your foot in the door. You have a much better chance of building a liquidity network with your project token.
Lastly I see marketplaces as another big option if you can get things going. There are ERC-20 compatible marketplaces already built. There are systems out there for Ethereum and ERC-20 payments for goods and services. You still will have some work to get put into some of these services, and need some name recognition, but you don't have to build the service or convince service providers to add another chain. Granted, there are other chains out there that are building an ecosystem as well. There are some other fairly well established projects in the top 10 and top 20. Those platforms do provide another option if you want to be a token but don't want to be on Ethereum. Some projects are taking those routes based either on their global location of operations, their target audience, their project goals, or any other number of reasons. That's not necessarily a bad choice either. But it is hard to argue that Ethereum is not the most well established platform at this time.
What about the other things that are a little more behind the curtain. If you are a mining or staking chain, depending on your consensus protocol, and depending on how the chain works this can mean any number of things. You have to find a way to fund and maintain the chain, do upgrades, pay for servers and load balancers and RPCs and a whole bunch of things. Yes, some computing power is required for tokens as well, especially if they have a complex thing they are doing like an exchange. But they don't have the added cost and time expense of keeping a chain running. Again, this time and effort can go into the project and help to make it more likely to succeed.
But what is next? What about getting on popular sites where dapps are reviewed? If you are an Ethereum project it's no problem to get up on something like State of the Dapps. Ethereum is already their biggest list, you don't have to convince them to add your chain. Same can be said for staking websites. Really anything talking about Ethereum. You make things easier all around for exposure to the most used resources. This is very helpful especially if your project has a budget. You have easier access to exposure without having to convince them to integrate a new chain. Exchanges, this is a big one. First off you have centralized exchanges, it is loads harder to get a centralized exchange to integrate a new chain. Not only convincing them, but then paying them for the integration. Spending your time and project resources working through that integration and the testing. Oh, and say you want to work with a liquidity provider or woo a bot trader to do arbitrage across exchanges, now they may have to work on cross chain liquidity. But there are a host of projects on Ethereum already that provide trading for tokens. There are ERC-20 liquidity networks. There are some decentralized exchanges and swap services out there that users can add tokens to themselves. There are some simple ETH smart contract swaps out there that are non-kyc and all you need is your token contract address and you are off and running. I even read about a smart contract fiat gateway on the Ethereum network that is essentially a smart contract escrow service. So your project can immediately have decentralized non-KYC fiat integration. Another big one is DeFi. The DeFi services run the gambit as well. There are larger well known DeFi providers with custodial wallets and KYC, and those for sure will be hard to crack. There are other DeFi projects with a DAO, these also might be a little tougher to get listed, but you have a chance. But being on Ethereum, the current established frontrunner for DeFi gets your foot in the door. You have a much better chance of building a liquidity network with your project token.
Lastly I see marketplaces as another big option if you can get things going. There are ERC-20 compatible marketplaces already built. There are systems out there for Ethereum and ERC-20 payments for goods and services. You still will have some work to get put into some of these services, and need some name recognition, but you don't have to build the service or convince service providers to add another chain. Granted, there are other chains out there that are building an ecosystem as well. There are some other fairly well established projects in the top 10 and top 20. Those platforms do provide another option if you want to be a token but don't want to be on Ethereum. Some projects are taking those routes based either on their global location of operations, their target audience, their project goals, or any other number of reasons. That's not necessarily a bad choice either. But it is hard to argue that Ethereum is not the most well established platform at this time.
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