For many Web3 application developers, there is a perceived tradeoff between ease of development and application customization. Web3 developers have long been forced to choose between the expensive process of setting up their own chains or settling for costly and burdensome off-the-shelf infrastructure. Ultimately the disadvantages associated with both options create barriers for both developers and end users, which hinders Web3 adoption.
However, there is a third option. On-demand appchains — or application-specific blockchains — that are built with pay-as-you-go scalability offer the affordability of base layer protocols but with the flexibility of purpose-built chains. If these types of chains proliferate, previously idealized Web3 utility may lie just around the corner.
Examining tradeoffs
The dichotomy between the “fat protocol” and “fat application” theses is a prerequisite for understanding the advantages and disadvantages of base-layer protocols and purpose-built applications. The “fat protocol” thesis posits that most of the value in Web3 will be captured at the protocol layer. At the moment, this is broadly true, as most activity and transactions — as well as monetary value — in the blockchain ecosystem are captured on base layers, such as Solana and Ethereum. Proponents of this thesis argue that storing user data across an open and decentralized network — rather than allowing individual applications to control access to disparate silos of information — inherently lowers the barriers to entry for new entrants and fosters a more vibrant and competitive ecosystem of products and services on top of a protocol.
Nevertheless, “fat protocols” have their drawbacks. Most layer-1s struggle to effectively manage network congestion. To alleviate this congestion, these protocols levy “gas fees” on users in the same way that tolls and traffic lights can be leveraged to reduce traffic. Applications operating atop the base layer will then pass these fees off to their end users.
Continue reading: https://forkast.news/why-appchains-are-critical-to-web3s-future/
However, there is a third option. On-demand appchains — or application-specific blockchains — that are built with pay-as-you-go scalability offer the affordability of base layer protocols but with the flexibility of purpose-built chains. If these types of chains proliferate, previously idealized Web3 utility may lie just around the corner.
Examining tradeoffs
The dichotomy between the “fat protocol” and “fat application” theses is a prerequisite for understanding the advantages and disadvantages of base-layer protocols and purpose-built applications. The “fat protocol” thesis posits that most of the value in Web3 will be captured at the protocol layer. At the moment, this is broadly true, as most activity and transactions — as well as monetary value — in the blockchain ecosystem are captured on base layers, such as Solana and Ethereum. Proponents of this thesis argue that storing user data across an open and decentralized network — rather than allowing individual applications to control access to disparate silos of information — inherently lowers the barriers to entry for new entrants and fosters a more vibrant and competitive ecosystem of products and services on top of a protocol.
Nevertheless, “fat protocols” have their drawbacks. Most layer-1s struggle to effectively manage network congestion. To alleviate this congestion, these protocols levy “gas fees” on users in the same way that tolls and traffic lights can be leveraged to reduce traffic. Applications operating atop the base layer will then pass these fees off to their end users.
Continue reading: https://forkast.news/why-appchains-are-critical-to-web3s-future/
