8 min read · Nov 29, 2023
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One of the main concerns of users and one of the most recurring reasons for criticism about cryptocurrencies like Ethereum are the use cases.
Those most critical of cryptocurrencies usually focus on pointing out that they are simple “vehicles for speculation” and that they have no real use beyond hoarding profits.
Nothing is further from reality. Blockchains, such as Ethereum(erc20 token develoment), allow any user to create decentralized applications within an open ecosystem , which has allowed the blockchain to become a reliable and stable payment system, as well as create market prediction tools, manage accounts or even build virtual worlds of all kinds.
At the heart of the Ethereum blockchain is Ether, the chain’s native token, which allows creators and developers to create new decentralized applications through smart contracts.
Ethereum smart contracts are self-executing contracts that facilitate, verify, and secure blockchain transactions. This is the most innovative and differentiating element of Ethereum.
These two elements, together, have caused the majority of the most popular NFT collections and many of the users’ favorite cryptocurrencies to have been created on the Ethereum ERC-20 standard.
Austria has become a pioneer country in the use of blockchain. The Austrian government has founded the “Austrian Public Blockchain Service” (APSB) which includes the country’s main government administrations and has notary and data certification programs.
The APSB is also working on cryptocurrency trading, mining, custody and payment services, as well as ICOs and security token offerings. For its part, thanks to these initiatives, Raiffeisenbank offers cryptocurrency investment services to its clients.
Wien Energie, the country’s main energy services company, is researching possible uses of blockchain and smart contracts in electricity sharing models. The company has created a P2P electricity distribution network that allows users to share or sell the electricity they generate through solar panels via blockchain.
Great, but what about Ethereum use cases? Being a public and permissionless blockchain , Ethereum creates an open space for experimentation, which has led to the emergence of thousands of decentralized applications, with a wide variety of different use cases, such as the ones we are going to see below. .
One of the first real-world use cases for Ethereum was the creation of Decentralized Autonomous Organizations (DAOs). In short, it is a type of organization that does not require a central authority.
The rules and regulations for using DAOs are encoded within one or several smart contracts, in this way all decisions must be voted on by the community.
In the most basic sense, a DAO allows you to control an organization without having to have a hierarchy , with complete transparency over structures and rules. A DAO also offers equal opportunities for all its members, regardless of how long they have been part of the organization.
An example of the use of DAOs is AssangeDAO, a decentralized autonomous organization created to raise funds, through the sale of NFTs, for the defense and release of Wikileaks creator Julian Assange.
One of the main real-world use cases for Ethereum is decentralized finance (DeFi) applications. Here we can find a wide variety of functionalities ranging from decentralized lending (based on smart contracts), decentralized exchanges and the creation of stablecoins.
One of the objectives of decentralized finance is to create a financial ecosystem made up of small applications , like Lego pieces, that are compatible and complement each other, thus creating a “large global solution” that does not require a central institution.
An example that unites this use case and the previous one would be MakerDAO and DAI. MakerDAO is a decentralized autonomous organization that has created a stablecoin, DAI, aimed at facilitating the creation of decentralized applications.
Cryptocurrencies, both Bitcoin and Ethereum development , can be used as forms of payment. The characteristics of smart contracts and blockchain make Ethereum a very advantageous means of payment.
Instead of depending on the honesty of a third party or a banking entity, smart contracts can manage the transaction , encoding each step of the sale. In this sense, since the blockchain is public and transparent, anyone can review the transaction information, and since it is immutable, it cannot be manipulated or duplicated.
In this sense, Ethereum could be used to send international remittances, a business that moves about $500 billion a year. Today, sending large amounts of money between countries is a slow and expensive process, as it can take days. However, with Ethereum the sending of remittances can be immediate and, in addition, completely free of charges , as it can be done directly between users, without the intermediation of a banking entity.
Some companies such as Everex, BloomX or Abra are already using the blockchain to eliminate banks and offer remittances free of transaction fees. As well as the UN World Food Program, which has used blockchain in a program to facilitate the sending of money between more than 10,000 Syrian refugees in Jordan.
Digital identity management is one of the most concerning issues for the future of society. Thanks to Ethereum smart contracts, problems with digital information monopolies could be avoided , as well as data leaks or thefts.
The means of identification have barely changed in the last five decades. We continue to use identity documents, passports and traditional physical media that we have to carry with us at all times. This is because it has not been possible to find a sufficiently secure system to verify identities by governments. However, Ethereum allows data to be verified in a transparent and secure system, which would be almost impossible to falsify.
When talking about use cases, Vitalik Buterin himself, co-creator of Ethereum, has pointed out on more than one occasion that his blockchain could be used to create a transparent voting system that could be implemented in countries with unstable democracies or in danger.
With Ethereum it would be impossible to manipulate the results of an election, since each vote would be recorded in the blockchain and, since no person or entity has the power to change the records, it would be impossible to change the results of the elections. In addition, each vote would be visible to everyone, so any organization could contrast and review the results of an election.
Ethereum can also revolutionize the health and medical care sector, as it facilitates the creation of a public and secure data network , which will allow any hospital or doctor to access patient data and records at any time and no matter where. be found.
Data can be recorded and shared very easily, and can even be linked to portable or wearable devices that would make it possible to carry our medical data with us and share it with our doctors anywhere. In this way, these devices could keep a continuous record of our health status in real time, sending the information to medical professionals, immediately notifying us of any problem, such as a heart attack.
Large companies like Google or Microsoft store an enormous amount of information in “server farms . ” These are buildings with hundreds of servers that are used to store data and information. The problem with these server towers is that companies store a lot of information in the same physical space , which poses a high risk.
A possible solution would be the creation of a decentralized storage space. In this case, the information would not be stored in two large buildings full of servers, but in hundreds (or thousands) of small buildings with servers around the world.
Until now, this was impossible due to the technological difficulties involved in creating a network that connects all servers and allows immediate transfer of information. However, Ethereum offers a solution to this problem since blockchain technology can be used to encrypt and send information between different servers .
Blockchains have many applications in the world of music and multimedia content playback. For example, they could offer greater flexibility in pricing and distribution , improving the prices users pay. For example, users who pay a monthly subscription to a music service with millions of songs of which they only listen to 20% or less. A subscription system created with Ethereum would allow personalized subscriptions to be designed in which each user would pay for what they listened to.
It could also be used to optimize the payments that artists receive . Thanks to the blockchain, they can have a public record of their income, so they can see exactly how much money their music has raised.
Ethereum could also make it easier to identify a song’s copyright. As a single, global database, anyone could review the intellectual property rights of a song, creating a secure and immutable record that could be synchronized with the monetization system, through smart contracts, to ensure a fairer distribution of royalties. income.
Blockchain can reduce costs and improve transparency. This would be possible since Ethereum would create its own network in which most of the bureaucratic processes that complicate logistical processes and increase final costs could be eliminated.
It could also improve the current understanding of the flow of trade , as we would have a system to track and trace products in real time at each stage of the journey. In this way, we could better understand the risks associated with each stage and improve their management.
Thanks to blockchain technology, brands could maintain real-time tracking of their products. For example, a high-end brand could track a shipment between Spain and China, recording all the details of each point along the way, such as the temperature of the containers and the ports at which it has stopped. In this way, brands can prevent counterfeits or claim liability in case of poor cargo handling.
In 2018, the Center for Social Innovation at Stanford Business School analyzed the work of 193 organizations, initiatives and projects that use blockchain for social and public work.
This study found that 86% of these initiatives were making real progress in solving public problems. For example, some organizations are creating a blockchain system to create a credit system that protects the more than 2 billion people excluded from the banking system .
Another real-world use case for erc20 token development service would be to record and track nonprofit donations. In some cases, such as money donated to help with natural disaster recovery, 30% of donations are lost or diverted. Thanks to the immutability of the blockchain, donations are recorded and, therefore, fraud and diversion of funds can be prevented.
