In a market where Bitcoin holds over 52 percent of the total market capitalization and is highly dominant, Ethereum has established a name as the singular most prominent platform on which tokens run. According to CoinMarketCap, the third most valuable coin has 94 of the top 100 valued tokens running on its decentralized platform.
Why Ethereum Dominates
These statistics have shown that the number of top tokens established on the Ethereum platform have cemented Ethereum’s place as the number one selection for token developers. The other 6 percent of the top valued 100 tokens that aren’t using Ethereum’s platform use either Stellar Lumen’s platform, NEO’s platform, Omni Layer’s platform or NEM’s platform. Of these six other tokens, Tether (USDT) is the most recognized of them all.
It is widely believed that the reason why the Ethereum platform is the popular choice for most token developers is that it started way early, in 2015. Just like the adage that says, ‘the early bird catches the worm,’ Ethereum has caught 94% of the top tokens in its almost perfectly woven web and wormed its way into developers’ hearts.
Although Bitcoin and Litecoin have been around way before Ethereum, they certainly weren’t created for the same purposes. Litecoin was created for speed-like transactions, with some describing the altcoin as a ‘cheap version of Bitcoin.’ Bitcoin was created mainly for payments and serves as a store of value, gaining the name, ‘digital gold’ over the years. Ethereum, however, was created for developers to use for their tokens.
Another reason that has facilitated Ethereum’s domination in the token development world is the ERC-20 token standard. While Ether tokens have multiple standards, the ERC-20 standard is widely in use for these valuable tokens. To breakdown ERC-20 to you, the layman, it is a set of rules that are meant to be complied with to allow developers make their own tokens well-suited to other tokens in the network.
One of the reasons the ERC-20 standard is so popular is because of its ease in allowing a crypto project create their tokens so an Initial Coin Offering (ICO) can be held. Some also use the ERC-20 standard for creating their decentralized applications. Most of the tokens publicized on BitcoinTalk, the most popular forum in the cryptocurrency world are usually based on the ERC-20 standard. Some projects, however, choose to opt with the ERC-223, ERC 20’s superset.
How ERC-20 Tokens have Fared in the Crypto Space
Tokens using the ERC-20 standard have also gained mass support from centralized exchanges. Coinbase, one of the most popular American crypto wallets added 0x (ZRX) to its platform some four months ago. Since that time, it has also added other ERC-20 tokens like Basic Attention Token (BAT), USD Coin (USDC), Loom Network (LOOM), Maker (MKR) to its platform.
The most popular ERC-20 token at the moment is Binance Coin. It is the second most valuable token in the crypto market and takes a spot at the 12th position in terms of market capitalization in the crypto market, as according to CoinMarketCap.
Some Ethereum critics have stated time and time again that in the nearest future, Ethereum will lose its position. This assumption, however, has proved more and more unlikely by the day.