Introduction
When discussing cryptocurrencies, one must take into consideration which blockchains have the potential to be resilient and promote longevity. A blockchain must grow in its technological development on a consistent basis in order to stay relevant in an industry that is moving at a rapid pace. Ergo has always been a project that puts longevity at the forefront of its priorities, and it endeavors to be a blockchain that will provide real-world applications for decades to come. This goal is made possible through a combination of factors, such as organic community growth, technological innovation and development, prioritizing long-term growth over short-term growth, and ultimately, thoughtful planning.
[Ergo Platform. Ergo: A Blockchain to Stand the Test of Time. (Accessed October 11, 2022)].
The onset of crypto communities have led to people to start taking more of an interest in finance and gradually building trust around these digital currencies. With this constantly evolving technology and the complexities around them, the communities formed around them help users to understand the technology as well as allow brands to flourish in the crypto space [...] Such communities that bloom from an idea that everyone can believe in allow new markets and new crypto-based products to grow through trust in the fact that everyone is working towards the same goal. Experts in the crypto space believe that communities are essential to the growth of said digital currency. A thriving ecosystem consists of community members who help in developing the project by pushing boundaries, creating flat structures, and promoting new governance. Social channels help channel these advocacies and bring indispensable organic support.
[Peterson, S. Long-Term Success is Found in Organic Community Growth. (Accessed October 11, 2022)].
"Due to the fact that Ergo’s longevity as a proof of work, layer 1 smart contract platform is a priority in the ecosystem, there are many key features to the blockchain that facilitate long-term growth. Two such technological features are storage rent and sub-pooling" [Ergo Platform/Test of Time, supra].
"Through organic community growth, technological innovation and development, and ultimately the prioritization of long term growth, Ergo is setting itself up for success as a blockchain that can stand the test of time [...] With Ergo, the ecosystem and community seem to be aligning towards a collective trajectory [...] Time will tell, but in an industry full of hype and the need for instant gratification, it is refreshing to see a community collectively focused on long term plans to build a system that can improve the lives of everyone" [Id].
What Exactly is Ergo?
"In 2021, there still exists a focus on bridging the gap between Bitcoin and Ethereum. While multiple solutions have been presented, one of the most intriguing is Ergo, a project that has experienced a sudden surge in interest. The project’s objective of addressing the flaws of both Bitcoin and Ethereum was captivating enough that the ERG cryptocurrency price tripled within a month in August 2021" [Nambiampurath, R. What Is Ergo (ERG)?. (Accessed October 11, 2022)].
"Ergo is a type of secure blockchain based on decentralized finance (DeFi) functionalities. Its purpose is to combine the best features of Ethereum with those that Bitcoin has to offer. The project is outfitted with a proof of work (PoW) similar to the consensus protocol that Bitcoin uses to ensure its network is secure and smart contracts are available to accommodate DeFi. The security features were taken from Bitcoin, while the smart contracts and decentralized features came from Ethereum" [ByBit Learn. What Is Ergo Crypto: Combining the Best of Bitcoin & Ethereum. (Accessed October 11, 2022)].
More specifically:
Ergo uses a similar mining model to Bitcoin to create and validate new coins. But it limits the size of the computers that can mine, so there's no danger of creating the same carbon-intensive mining farms we've seen with Bitcoin. Ergo is a programmable blockchain like Ethereum. This means, among other things, that it can host decentralized applications (dApps). But, unlike Ethereum, it doesn't charge gas (transaction) fees. Ethereum's gas fees change depending on how congested the network is, so it's difficult to predict the costs of dApp development. In contrast, coders know exactly how much it will cost to develop their dApp on Ergo's network. Ergo has smart contract capabilities (tiny pieces of self-executing code that sit on the blockchain). And its coding language, Ergoscript, makes it possible to create more complex, and more secure financial contracts. This could make a big difference to the decentralized finance and stablecoin industries.
[Newbery, E. What Is Ergo (ERG), and Should You Buy It?. (Accessed October 11, 2022)].
Thanks to its user-friendly ErgoScript programming language, each ergo coin hosted within smart contracts has a layer of protection. It specifies when the coin can be used, by whom, and under which conditions. ErgoSript uses Sigma Protocols as the building blocks for zero-knowledge proof, used in cryptography. In practice, this means that a sigma (Σ) protocol revolved around a 3-fold proofing mechanism to secure contractual money:
- Message sent from the prover to verifier, as the first one
- Random challenge coming from the verifier
- Message sent from the prover to the verifier, as the second one
Based on these sigma protocols, ErgoScript makes it easy to develop smart contracts. Moreover, this is further helped by Ergo’s support for light nodes. These are blockchain software packages that neither need to hold an entire blockchain copy nor do they need to run 24/7. As such, they make Ergo very mobile-friendly because the need for storage space and computing power is significantly reduced.
[Nambiampurath, supra].
"Furthermore, by divesting itself from general-purpose languages, such as C, Java, or Python, ErgoScript was specifically designed to be the best at what it does — create code for decentralized finance. Specifically, contractual money in a Turing-complete manner but with a reduced potential for spam attacks thanks to its ahead-of-time estimation feature" [Id].
Finally, Ergo has been designed as a self-amending blockchain. As such, it is much easier to upgrade which is another key component of its resiliency characteristics. In Ergo, there is no hard set block size therefore based upon the demands of the network, it can increase or shrink as necessary.
Mining Ergo
Ergo is set to mint its entire supply in the 26 years following its initial mainnet launch in 2019 — in other words, by 2045. Mining Ergo tokens is simple and straightforward. All that's required is for the mining to configure a standard node, which is possible if your graphics processor has at least 4GB of VRAM. However, 8GB of VRAM is recommended. Since Ergo is based on the PoW consensus mechanism, miners are able to use multiple graphics processors on just one node. It's also possible to benefit from mining pools. However, the Ergo team recommends that miners select only small pools.
[ByBit, supra].
Several Noteworthy DApps in the Ergo Ecosystem
ErgoMixer
"ErgoMixer is the first non-custodial, programmable, non-interactive mixer in the space (and it is also the only token mixer to our knowledge). ErgoMixer utilizes Ergo's Sigma protocols to enable efficient, trustless mixing of funds, enabling a high degree of privacy and security" [ErgoDocs. ErgoMixer. (Accessed October 11, 2022)].
[For further technical information concerning ErgoMixer, see GitHub. Mix your ergs and tokens with ErgoMixer. (Accessed October 11, 2022)
SigmaUSD
"Built on the AgeUSD protocol, it is the first UTx0-based stablecoin. Unlike USDC or USDT, sigmaUSD is a decentralized stablecoin that has been developed in partnership with Cardano’s IOHK and Emurgo. Its collateralization and emission setup is as follows:
[Nambiampurath, supra].
Ergo Auction House
"What would a smart contract blockchain be without an NFT marketplace" [Id]. At the time of the writing of this article (October 11, 2022 @ 18:58 ET) there are 183 active NFT auctions with a total value of 2100.328 ERG. You may find these listed auctions by clicking here.
Spectrum-Ergo
"Spectrum.DEX is a decentralized financial (DeFi) application which means it does not have a central government body. Spectrum.DEX includes AMM functionality (Swap, Add Liquidity and Remove Liquidity) on top of the Ergo and Cardano Blockchains [...] Spectrum.DEX operates on a live blockchain, thus trades are final, and irreversible once they have status «executed». Every transaction can be viewed via Ergo and Cardano Explorer. By creating an order you send your funds to a specific smart-contract, all such contracts are wired into the user interface. Thus, orders are created entirely in your browser (on your machine) [...] Spectrum.DEX offers a form of added security, as buyers and sellers do not have to give their information to any 3rd party. However, Spectrum.DEX is without a Know Your Customer (KYC) process and can offer NO assistance if a user is hacked or cheated out of passwords, currency or private wallet keys" [Spectrum Finance. Know Your Assumptions. (Accessed October 11, 2022)].
Tokenomics
ERG is a deflationary token, hard-capped at under 100 million ERG. It doesn’t have a long tail of emission, and its block rewards steadily decrease following a two-year period. When ERG launched on the mainnet, block rewards were set at 75 ERG. After eight years, it will go down to zero, at which point the total ERG supply will have a settled number. Presently, ERG’s maximum supply is 97,739,924 ERG, with circulating supply a third of that, at 32,012,428 ERG. To put ERG’s emission into perspective, Bitcoin’s emission will be completed over 100 years, with nearly 75% mined within BTC’s first eight years.
[Nambiampurath, supra].
Final Thoughts
Per CoinMarketCap, at the time of the writing of this article (October 11, 2022 at 19:22 EDT) there is a circulating supply of 58,638,426.00 ERG. With the current price of $2.32 the market capitalization of Ergo (ERG) is $136,076,699. There is a total supply of 97,739,924 coins authorized yielding a fully diluted market capitalization of $226,815,880. Presently, Ergo (ERG) is ranked No. 233 by CoinMarketCap.
This article is intended for educational purposes only and in no way should be viewed as providing financial advice. Should you decide to invest you are fully absorbing the full risk of loss on your investment. And finally, remember the key investment rule - never invest more than you can comfortably afford to lose.