The development of blockchain technology and its applications with time! | by sophia wil | August 2022

The Internet may have been an urban myth in the 70s, but it is no longer a hoax, and its current form may disappear in the future. Connecting the world virtually has been one of humanity’s goals starting from the Industrial Revolution. Today, we have achieved the goal to some extent, and now the focus is on refining it to realize virtual lifestyles in these worlds. The so-called Web3 technology has helped build such worlds, in which blockchain technology is an element. This blog will focus on blockchains and their evolutionary outputs to the world.

Blockchains are digital distributed ledgers that record transactions as blocks. Each block adds to the previous one, effectively linking data together. The nature of blockchain technology ensures that data added cannot be deleted or manipulated as it is distributed across “nodes” (or devices connected to the network in any way). These networks are where all Web3 applications are hosted, similar to servers in the Web2 ecosystem. While the first blockchain ever supported its original cryptocurrency (Bitcoin), most blockchains today support many applications, thanks to the development of token standards and state-based smart contract programs.

Examples of popular blockchains include Ethereum, Polygon, BNB chain, SolanaFlow, Harmony, Avalancheand THRONE.

Cryptocurrencies are digital fungible tokens registered on the blockchain and can be used in the same way as fiat tender in the virtual world. In fact, blockchain technology was realized because of the cryptocurrency Bitcoin ($BTC). These tokens can be used in the Web3 world for virtual use cases of real currencies such as trading and investing. Each blockchain network has its own cryptocurrency, and so do applications built on them. Each of them has different reasons, although it is about motivating users for their time and effort.

Stablecoins are cryptocurrencies with the twist of being linked to elements such as fiat tender, precious metals, cryptocurrencies and even programmed algorithms. These came out due to the extreme fluctuations in the crypto markets during the year due to various real world issues, which has been an unanswered question yet for crypto enthusiasts.

Crypto wallets are applications where people can hold the private keys or “seed phrases” of their Web3 holdings, similar to credit card PINs. A basic necessity for Web3 users, these applications come in several varieties, including desktop, mobile, web, hardware, multi-currency, and coin-specific.

Crypto exchanges are platforms where people can exchange crypto or fiat tenders. This was the first ever use of cryptocurrencies, with the first exchanges allowing users to buy Bitcoin with US dollars or euros and exchange BTC back into fiat currencies. These platforms can be said to be the entry points for novice crypto enthusiasts.

As businesses began to flourish in the Web3 realm, new project ideas took off from all corners of the globe. Nevertheless, not all projects had sufficient resources to build themselves, which led to the development of crypto-crowdfunding mechanisms.

It all started with Initial Coin Offerings (ICOs), which were unregulated, although many successful projects today have benefited from the mechanism. 2017 was the year of ICOs as the mechanism supported many companies to get much needed financial support. Their unregulated nature led to their downfall, with not many startups choosing to use ICOs for their projects.

Initial Exchange Offerings (IEOs) came next, which were tightly controlled by centralized crypto exchange firms. While these served favorably as a transition weapon from Web2 to Web3, the centralization did not bring optimism among crypto-fanatics. Of course, not many projects used IEOs to raise funds.

Security Token Offerings (STOs) are based on crowdfunding tokens backed by real-world assets that act as collateral for investors, which can be useful in a worst-case scenario.

Initial DEX Offerings (IDOs) are based on decentralized crypto exchanges for token sales and liquidity. The mechanism is useful since it is optimally controlled, not by a centralized entity, but by the community that runs the platform. Here, “platform” refers to IDO launchpads that act as one-stop solutions for investors to know about Web3 projects and invest in their tokens.

Decentralized Finance (DeFi) is the economic arm of blockchain technology. The sector is home to several applications based on stakes, lending and borrowing, flash loans and yield farming. All of these tend to give use to cryptocurrencies that would otherwise sit idle in crypto wallets. These can be used for cryptocurrencies, stable coinsplatform-based tokens, and even various tokenized assets (which we will see next).

Non-fungible tokens (NFTs) are entries on the blockchain that can prove ownership and authenticity of assets back. These have been widely used by digital creators such as digital artists, some of whom have earned recognition and money by selling NFT artwork on special platforms called NFT marketplaces. These symbols return almost anything, regardless of their existence in digital or physical form.

A fascinating use of NFTs is an NFT game that uses these tokens for in-game assets such as skins, armor, gear, vehicles, and characters. These are based on earnings models such as e.g Play to Earn (P2E), Move to earn (M2E), and NFT rental. They can also be built for game genres including action, combat, racing, sports and simulation.

Metaverses are virtual worlds where people can interact and socialize with each other through digital events. These are projected to become the versions of digital worlds that we have been imagining all these years. Metaverse technology can be used to support various real-world domains through digital versions for better functionality, such as healthcare and workplaces.

Metaverse game have been advanced versions of NFT games that concentrate on offering immersive experiences through the use of other Web3 elements such as virtual reality (VR) and augmented reality (AR). Otherwise, these platforms are also based on different revenue models and available in different genres.

Therefore, we can realize that blockchain technology has affected us in more ways than it might seem. It should also be noted that Web3 is still emerging and will become mainstream when all the elements blend to provide extraordinary digital experiences that have never been possible. If you want to develop such applications based on blockchains, it is ideal to work with an experienced blockchain enterprise company that excels in creating such high-quality platforms.