There are a lot of blockchain based assets out there. As in 10,000+ a lot. With the industry becoming increasingly crowded, it can be quite hard for a new project to even get noticed. Really inspiring projects, both new and old, are facing an insurmountable uphill battle for support that they simply can't all win.
Or can they?
The real question we need to ask ourselves is -- Why do we need 10,000+ cryptoassets?
The answer, shockingly, is that we simply don't. Many of the most prominent technology companies from the last bull cycle (many of which are still building), have gone completely forgotten amid the hype for DeFi and NFTs. The once abundant support for their ideas ran dry during the bear market and moved on, leaving a shell of the former community of developers and supporters.
These projects are still viable and still have a lot to offer the industry.
Unfortunately, the industry only cares about the hype cycle and pumping bags. This leaves strong developers and promising engineers in situations where they start to either run low on funding or even lower on morale. Building products for 3-4 years only to see support levels continue to deteriorate and user bases dwindle while forks of forks of Uniswap garner major attention is both demoralizing and infuriating at the same time.
So what do we do? How can we help these once shining stars find their way back to prominence, or at least, a higher level of relevance? I believe the answer to that question is the blockchain merger. Something that has long been hypothesized but never quite mapped out or tested.
Let's dig deeper into what a blockchain merger is, how one might be structured, and the benefits to the industry as a whole.
What is a blockchain merger?
A Blockchain Merger is a process by which two separate blockchains can come together to form one new blockchain that is a combination of teams, tokens, and communities from already existing projects. One blockchain and one cryptoasset would emerge, but the new project would have the combined support of both development teams, both communities, and both sets of token holders.
Why would two blockchains merge?
For starters, a blockchain merger wouldn't need to only include two disparate blockchains. It could include as many as wanted to participate. In the case of an alliance or a consortium, you might even see a combination of 10-15 cryptoassets into one blockchain. This is not only possible, but I would argue a major positive for the industry.
Let's look at some positives:
- The new project now has the combined support of multiple development teams.
- The new project now has the combined support of multiple communities.
- The new project now has the combined support of thousands if not tens of thousands of token holders
- The project now has a potential to hold the combined market cap of all projects involved
- The project now has a potential to hold the combined daily volume of all projects involved
Why do these metrics matter? Well for starters, many apps and services look at market capitalization, daily volume, and user numbers when considering new integrations. For assets that are running on native blockchains that are not ERC20 tokens, this is a major problem. By combining disparate communities from smaller projects, you are able to present a combined front that is much more appealing than your previous individual communities.
OK, OK, so it's probably not all roses, right? What are the disadvantages to a blockchain merger?
- Disillusioned supporters for one. Some users may feel attached to their current project and may not want to support a combined brand.
- Division of effort. You will have to determine how to combine multiple teams potentially working on different solutions or different protocols and convince them to work together. Not an easy task.
- It's expensive. The new network would need a way to support multiple teams and goals including all different tiers of salaries and spending.
There are clearly both positives and negatives to the blockchain merger. The complexities of combining two, three, or even ten projects into one and organizing them under a single banner is a daunting task.
It's daunting, but I believe it is possible. Not only that, but I think it is a good idea. In the next post, we will take a look at how it might work and take a deeper dive into the DNA of a Blockchain Merger.