Grayscale Investments, a cryptocurrency asset management, recently likened Ethereum to New York City in a paper titled “Get Smart on Smart Contract Platforms.”
According to Grayscale’s analysis, Dragonfly Research “pioneered a helpful paradigm for understanding blockchains by comparing them to cities, with the premise being that blockchains are comparable to cities in that each chain is a physically restricted network that prioritizes distinct attributes.”
Grayscale was referring to a Medium blog article published on January 18 by Dragonfly Research. Haseeb Qureshi said in the Dragonfly report that although “people often refer to L1 blockchains as networks,” networks are the “wrong comparison for blockchains” since “blockchains are physically restricted.”
Qureshi said, “smart contract chains are more akin to cities.” He then argued that using this perspective, Ethereum may be compared to New York City:
“Certainly, New York is a buzzing city! It is home to the world’s largest banks, the largest number of millionaires, and the trendiest brands and personalities. Similarly, Ethereum has all of the largest Defi protocols, the most TVL, and the most popular DAOs and NFTs.
“However, it is costly. If you are a rising star, you are priced out. Perhaps if you had purchased assets sooner, you might have been wealthy. However, today’s pricing will eat you alive, and there simply isn’t enough space for everyone. While the millionaires may be OK, the next generation will be forced to relocate.”
“Ethereum is similar to New York City in that it is big, costly, and crowded in certain sections. However, it also boasts the most robust application ecosystem, with over 500 applications worth more than $100 billion—more than 10 times the value of any other competitive network.
“While accessing the network is costly, users and developers may rest certain that Ethereum will likely remain the center of gravity for application innovation and liquidity in the future, owing to the scale of its community and the amount of cash locked up in the network’s smart contracts.
“An L2 solution, such as Polygon, is akin to a skyscraper in New York City: it climbs higher. Polygon first consolidates and resolves several transactions internally before resolving them on Ethereum’s base chain, providing users with both the security of Ethereum’s base layer and the cheap costs associated with a centralized chain.”
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