The post Collaboration is the Solution to Web3’s Fragmentation Crisis appeared first on Coinpedia Fintech News
Fragmentation in Web3 is an unfortunate fact, with each camp championing its own technology. Blockchains operate in silos, which deepen tribalism instead of encouraging meaningful collaboration. The explosion of L2 solutions on Ethereum has deepened fragmentation, with each blockchain actually competing against Ethereum. Some analysts cite this fact as the reason for ether’s stagnant price.
Others take this view even further – that the price of ether can only go down. They argue that Ethereum’s scalability results in fewer users relying on the L1 blockchain, opting to leverage L2 solutions instead. These solutions pay very low fees, and Ethereum’s revenues are correspondingly lower. The end result could be a divergence between the price of ether, dropping due to lower fees, and Ethereum’s L1 utility (increasing by the number of L2 users).
A third argument is that some successful L2 solutions might end up detaching from Ethereum in the long term, taking their user base with them.
Bitcoin and Ethereum should cooperate, not compete
Bitcoin boasts a solid security model based on UTXO or Unspent Transaction Output – an output that hasn’t been used as an input in a transaction (transferring Bitcoin from one address to another). On the other hand, Ethereum is renowned for its flourishing dApp ecosystem. Both blockchains focus on decentralization but fulfill different purposes. Ethereum’s rich functionality enables the execution of smart contracts and applications, while Bitcoin is mainly a store of value.
Despite their differences, Bitcoin and Ethereum shouldn’t compete. Bitcoin should be used as a stable asset and a store of value, while Ethereum interacts with the dApps running on it. An investor could use Ethereum to access DeFi services in a portfolio and Bitcoin – to preserve value.
Apex Fusion bridges the best of Ethereum and Bitcoin, building on the concept of uniting Web3 and moving beyond competition to create a scalable and collaborative blockchain ecosystem. The platform promotes a unified ecosystem that is inclusive, neutral, and designed with interoperability in mind. It provides a platform where existing projects and developer communities can innovate, integrate, and deploy.
Apex Fusion’s ecosystem is comprised of three layers designed to optimize security, scalability, and decentralization from the start. These three interconnected networks – Prime, Vector, and Nexus – each serve a unique purpose. Prime Network, an L1 blockchain based on UTXO, is the foundational Apex Fusion ecosystem layer that provides security and decentralization. Vector Network, an L2 on UTXO, is a secondary layer that enhances performance and scalability and is designed for high-throughput services and applications. Finally, the EVM L2 solution Nexus Network focuses on speed and cost-efficiency, handling complex transactions and smart contract execution.
The three chains are connected through the Reactor Bridge, enabling interoperability and efficient interaction throughout the ecosystem. This unique architecture offers users more flexibility by making dedicated blockchains available, which are optimized for a specific use case.
The Prime layer ensures a predictable, decentralized, and secure environment. Traditional L1 blockchains compete for execution, but unlike them, Prime emphasizes liquid staking, giving developers a neutral foundation on which to build.
The ecosystem’s core is interoperability. It’s designed with seamless cross-chain interaction, allowing projects to use multiple blockchain technologies frictionlessly. Ethereum developers can use dedicated chains with full EVM compatibility and don’t have to compete with L1 solutions.
Apex Fusion is entering an exciting development stage, namely the Prime Mainnet launch. Stake pool operator (SPO) onboarding is underway, guaranteeing a fully decentralized network from the start. The platform is finalizing cross-chain interoperability tools, enabling frictionless interactions between its three layers. Early adopters will receive participation rewards and engagement incentives. More than 80 SPOs are operational on the testnet, ensuring resilience and stability.
We’re all paying a high price for fragmentation
The problems caused by Web3 fragmentation are evident. Monetary incentives are the primary driver of end-user and project activity at the moment. Estimates suggest that there are at least 1,000 blockchains, and most of them replicate a small number of successful use cases without end and without innovation. Ultimately, users are unable to take advantage of the ecosystem in its entirety, which discourages adoption and reinforces the bias that Web3 is complex. This bias misleads people into believing that the complexity is purposeful and conceals illicit activities. These misconceptions compromise exploration and experimentation.
The transition from fragmentation to collaboration holds immense potential. Simplifying onboarding will lead biases surrounding Web3 to dissipate. Partnerships with reputable projects can enhance Web3 platforms’ trustworthiness and credibility. For example, Apex Fusion’s Reputation System quantifies and validates contributions, ensuring trust and transparency in decentralized environments. This development has given rise to the concept of “trust through reputation.”
A blockchain project that specializes in developing smart contracts can cooperate with a decentralized oracle platform to improve its apps’ reliability and security. Such a partnership would allow the blockchain to tap into the oracle’s expertise. The oracle would, in turn, refine its technology by gaining access to more real-world use cases.
Blockchain projects can collaborate on decentralized identity solutions, cross-chain communication protocols, or other interoperability standards. Such collaboration enhances user experience by enabling interactions.
Partnerships within Web3 can enhance resilience and mitigate risks. By diversifying partnerships, projects can reduce reliance on a single service provider or technology. What’s more, collaborations frequently involve due diligence on future partners, helping identify potential weaknesses or risks early on. Teams can address issues promptly, minimizing the likelihood of project failure.
Web3 projects can cooperate on educational programs or hackathons, which encourage community involvement. These activities benefit individual projects and unite decentralized communities.
At its core, Web3 is about people, but project silos and tribalism harm exploration. Apex Fusion aims to propagate an environment where projects and developer communities contribute their unique advantages to a shared ecosystem and grow together.
