Ethereum is often promoted as the ultimate solution for decentralized apps, with some even claiming that it will be the substrate for developing all software in the future. This grand vision is in conflict with current reality however where ethereum now can’t even hold onto one of its biggest mainstream adopters, Kik.
Kik Kicks Ethereum to the Curb
Ted Livingston, founder and CEO of Kik Messenger, has revealed in his latest community Q&A that the Kin token will be switched away from ethereum. He said that the smart contracts altcoin is “trying to be everything to everybody, and that makes it general-purpose and slow.” Livingstone further derided ethereum as “the dial-up era of blockchain.”
Kik Messenger has over 300 million registered users, and is mostly popular with teenagers. It is known for features preserving users’ anonymity, such as allowing registration without a telephone number. Kin was meant to be an ERC20 token based on ethereum which will be integrated into Kik as the primary transaction currency. Its ICO earlier this year raised nearly $100 million from more than 10,000 investors from 117 countries. The token developers are now changing it to be stellar-based instead.
Congestion, Cats, and Gas Costs
The reasons cited by the Kik CEO for abandoning ethereum are its current lack of reliability and scalability for handling numerous transactions. The developers were testing Kin with just 10,000 users and discovered ethereum fails to match their needs.
In addition, the costs of using the altcoin are now too prohibitive for handling micro-transactions. The average transaction fee on ethereum is now $1.08 and the median cost is $0.377, according to Bit Info Charts.
One might have expected that the flood of ICOs launching ERC20 tokens might be the cause of ethereum’s congestion and backlog problems, but the truth is a bit more ridiculous. People playing around with virtual pets known as Crypto Kitties have contributed towards congesting the ethereum network and driving costs up.
Are the issues affecting ethereum at the moment just temporary or is this likely to be a permanent problem? Tell us what you think in the comments section below.
Images courtesy of Shutterstock.
Author: Avi Mizrahi