What is a blockchain ecosystem?

Those of you who remember biology classes may automatically think of the scientific definition of an ecosystem, which is “a biological community of interacting organisms and their physical environment.” But what does it mean in the context of blockchain technology?

Sasha Ivanov, founder and CEO of the Waves Platform suggests a blockchain ecosystem is comparable to roads, in that just as there are many types of roads, there “is no single type of blockchain.” In his analogy, published in Bitcoin Magazine, he points out that every blockchain is “purpose built for its own ends,” and that just as roads have a number of added elements, such as traffic signs and lights, plus required adherence to specific rules of use, so does the blockchain.

The four parts of a blockchain ecosystem

Looked at in that light, a blockchain ecosystem represents all the independent parts and how they interconnect. Let’s take the Bitcoin ecosystem as an example. It has four constituent parts: the users who want to make payments; the miners; the investors and the developers who maintain the ecosystem. They all play an important role. If one element is missing, the ecosystem collapses.

Ecosystems with different purposes

Of course, Bitcoin is not the only blockchain ecosystem. We also have Ethereum, with its ‘smart contracts’ as the core concept. NEO is another project that offers smart contracts, whilst Ivanov’s own Waves Platform focuses on mass adoption and real world applications. And as he explains: “Every blockchain project of note has a robust ecosystem under its hood, and they almost always include a decentralized exchange.”

Apart from the exchanges and token, blockchain ecosystems also deliver applications that “businesses, developers and communities can build on to create their own services and projects,” as Ivanov puts it. That is where the whitepapers come in, because that is where you will find the explanation of all the elements of the ecosystem, including which ones are already developed and the ones that are in the pipeline.

We are also seeing the emergence of projects designed to promote specific ecosystems, such as the Enterprise Ethereum Alliance. Its stated aim is: “The Enterprise Ethereum Alliance connects Fortune 500 enterprises, startups, academics, and technology vendors with Ethereum subject matter experts.”

So, just as a road can take you to a variety of destinations, so can a blockchain ecosystem. A strong blockchain ecosystem will have components that work harmoniously together. It should provide a journey with seamless interconnections: if there are traffic jams then the ecosystem is breaking down. And nobody likes a traffic jam.

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