8x Protocol, the protocol for facilitating recurring cryptocurrency payments will be built on Ethereum.

Here’s why.

Platform vs Platform

Recently in the cryptocurrency space, there has been a major spotlight on new platforms that are labelled as the next “Ethereum Killer”. Most of said platforms boast higher TPS (transactions per second) and sell their platform as the scalable Ethereum.

While it is impossible to predict the future of Web 3.0, Ethereum looks like it is here to stay.

Ethereum’s Trilemma

As a reiteration from above, platforms are attempting to outshine Ethereum through their large TPS.

But at what cost?

One of the important concepts to understand is of Ethereum’s Trilemma. This is the idea that the platform (in its current state) can only choose two out of three of its essential features; scalability, security and decentralisation.

In order for platforms to out-perform Ethereum in its TPS, many of them have resorted to sacrificing the concept that Ethereum has protected; complete decentralisation. Methods of doing so include the implementation of restrictions on node locations (to minimise latency) and even cherry-picking node operators (setting a minimum node computing power).

Without complete decentralisation, platforms begin to portray the negative effects that arise from governing bodies and centralised organisations. This is evident in the problems that surfaced in the main-net launch of EOS. EOS is a dAPP (decentralised application) platform that raised $4 Billion in their ICO. Through their use of delegated proof of stake mechanism, the platform is able to achieve a high benchmark of TPS speeds.

However in their main net launch, token holders were able to witness the power of the EOS constitution and the 21 nominated “Block Producers (BP)” who were able to freeze token holder wallets. Although the BP’s did this to prevent fraudulent activity from occurring, the event has highlighted future ramifications that may arise where the issues will be upscaled by the amount of transactions operating on the platform.

“The fact that EOS transactions are subject to ‘arbitration’ based on an unclear document of zero legal force means that EOS transactions lack finality.” — Emin Gun Sirer, professor at Cornell.

While Ethereum does have its current issues of scalability, it has not sacrificed the concept of decentralisation (importance of this covered in next topic) and through the test of time, Ethereum has proven that their base one layer has provided substantial security to its users.

Ethereum’s dominance will be reaffirmed through the implementation of a practical scalablility solution. Notable examples of works are Ethereum’s hybrid POW/POS consensus algorithm — Casper. While Ethereum continues to provide a secure and decentralised platform for its users, the community will be here to stay.

Leading on to my next topic…

Developers and Community

One of 8x Protocol’s main vision is to develop a protocol on Ethereum’s Layer 2 that provides a solution to recurring cryptocurrency payments for dAPP developers.

What better place to achieve this vision but by building with the largest developer community in the blockchain space.

Network Advantages

As a result of the extensive developer community, Ethereum host a range of out-of-box tools and frameworks for dAPP developers such as Truffle and Web3.js. Not only will this save time but also reduce the barrier to entry for budding developers and innovators. 8x Protocol aims to increase this accessibility by creating easy to use SDK (software development kits) to enable recurring crypto businesses to thrive.

Decentralisation is important, however for developers this is ever more crucial. Many developers thrive on the censorship freedom that the blockchain provides. Ethereum’s dAPP develops can value the certainty that a centralised body would not be granted authority over their work.

A final note would be to highlight the network effect of Ethereum, where the platform users are not only growing but growing at an accelerating speed. This alongside the positive acts of Ethereum’s influencers (including grants and incubators) provide reason to the staggering amount of projects and dAPPs currently built on Ethereum’s ERC20.

This is why 8x Protocol will be built on the Ethereum platform.

Read about our recent collaboration with MakerDAO (team behind DAI) here.

Special thanks to Kevin Lu (product @ 8x) for co-authoring this article.