Money lego is the term used to describe how Ethereum makes it possible to connect different financial services to each other, also known as composability. In the last year, composability has become a very real competitive advantage for DeFi.
Mixing and matching smart contracts on the fly has proven incredibly valuable. But a $ 10,9 billion question remains: Will composability also work on Ethereum 2.0 as it has so far on the original world computer version?
Ethereum composability and throughput
"Composability is really important because it allows innovation to come together: entrepreneurs can compose with the creations of other entrepreneurs," said Chris Burniske of venture capital firm Placeholder.
For example, Netflix (NASDAQ: NFLX) relies on many services, such as content delivery networks, storage providers, analytics products, and many other solutions that most regular people have never even heard of.
These services rely on centralized identity verification, but on Ethereum this would be possible without the need to specify an identity. However, the simplicity of composability collides with the reality of Ethereum's throughput capability.
This is a problem known to all from the very beginning of the project. To remedy this, some projects are moving to a sidechain, but many are betting on Eth 2.0 which will offer much more space for transactions.
The core of the new throughput capability will come from a new architecture called "sharding". In practice, there will be multiple blockchains that will check in with each other via a beacon chain.
This should make everything move much faster and cost a lot less, but problems would arise if a transaction required synchronous communication (i.e. no delay or in real time). But there are concerns that composability may be hampered in some cases, in a fragmented environment.
Solve the problem
Hart Lambur of the UMA project, another protocol for creating unique options on Ethereum, believes there are non-engineering solutions to some of these problems. He proposes to solve the synchronization problems with what might be called DeFi-thinking.
In practice, he proposes to create protocols that simply guarantee paid transactions, based on some kind of risk profile. And if it turns out that there is a very expensive shard, for example, and even if Ethereum remains more expensive than other blockchains after all this, Burniske believes that Ethereum will still remain the home of DeFi. quotation of ETH in real time).
Some cities are very expensive to live in, he said, but people stay there because they are doing work that is worthwhile. Less urgent commitments, those that don't need to be immediate, can move to smaller cities.
In this way, said Burniske, second-tier solutions and other blockchains would be "similar to the peripheries." All in all, he remains optimistic about Vitalik's invention. “I think the components for a decentralized financial system could go to other chains, but I think the heart remains with Ethereum,” Burniske said. "Ethereum is the capital of DeFi".
