The Ethereum Virtual Machine (EVM) is the core of the Ethereum network and the heart of smart contract delivery and execution. EVM for Ethereum is like a computer’s CPU.

Currently, 80% of the top 10 chains are EVM compatible and even non-EVM (non-EVM) chains like Terra and Solana are developing solutions that are EVM compatible or can already work with EVM. Ethereum account system (NEAR’s Aurora, Solana’s Neon, Polkadot’s Moonbeam, …)

Why is EVM compatibility so important?

For developers, an EVM-compatible chain creates a code execution environment similar to an EVM. This means Ethereum developers can easily and quickly deploy on-chain protocols without having to write code from scratch.

For users, the benefits of EVM-compatible chains include lower gas fees, faster payments, and an Ethereum-like address format, creating a more user-friendly environment.

Additionally, EVM compatibility can help increase traffic and expand the ecosystem as Ethereum users can quickly migrate to new chains.

Footprint Analytics data shows that while Ethereum is still the leader among public chains, its market share has fallen by more than 10% over the past six months, from 72.87% to 61.19%. Emerging chains are rapidly growing and replacing Ethereum.

Ethereum is the most active chain in DeFi projects and users and is also home to cutting-edge projects like the NFT ecosystems. The fastest way for new chains to grow is to attract traffic through Ethereum, and EVM compatibility is the most convenient solution. This allows developers to quickly “copy and paste” contracts from Ethereum to other chains.

Blockchain Market Share as of June 30, 2021 | Source: Footprint Analytics

Blockchain Market Share on December 27, 2021 | Source: Footprint Analytics

Difference between EVM and non-EVM

Top 10 Public Chains and Their Categories:

• EVM: Ethereum, Binance, Avalanche, Fantom, Polygon, Tron, Arbitrum, Cronos.
• Non-EVM: Terra, Solana.

From chains’ TVL data, Solana and Terra account for over 11% of total TVL in 2021, although there are few public chains that aren’t EVM-compliant.

TVL on strings | Source: Footprint Analytics

Compare two popular EVM-compatible chains, Avalanche and Arbitrum, with two incompatible EVM chains, Terra and Solana.

A more prosperous compatible ecosystem

Looking at the on-chain data, there are more projects that are deployed on the public chain and compatible with EVM.

There are over 40 projects on Avalanche and Arbitrum, while relatively few are deployed on Solana and Terra.

As mentioned above, developers want EVM compatibility to be able to quickly scale and deploy in new chains, and the downside of EVM-incompatible chains is the number of projects.

On-chain project | Source: Footprint Analytics

Among the EVM-compatible chains, AAVE is the project with the highest TVL on Avalanche and Curve has the highest TVL on the Arbitrum chain, both migrated from Ethereum.

Avalanche TVL Log | Source: Footprint Analytics

The project offers more development opportunities for EVM-incompatible chains

Breaking free from Ethereum’s restrictions gives incompatible chains more opportunities to innovate.

For example, projects like Raydium and Serum are unique to the Solana chain. Terra, on the other hand, is a dedicated public chain focused on connecting on-chain and off-chain payments.

TVL log on Solana | Source: Footprint Analytics

Pros and cons of EVM and non-EVM

EVM compatible

• Pros: Scalable and easy to migrate from the Ether ecosystem; Projects have the ability to reach users more easily.
• Cons: Less innovation due to Ethereum and EVM rules.

Incompatible EVM

• Pros: Can create more differentiated and innovative applications; high user migration costs and more opportunities to break down ecosystem barriers.
• Cons: High developer costs, high barriers to entry, difficulty migrating projects and users from other chains.

EVM or non-EVM?

EVM compatibility is a key condition for evaluating public chain platforms.

EVM-compatible public chains can quickly acquire customers and grow in the early stages with the benefits of Ethereum. However, they have to compete with many other chains in the Ethereum ecosystem. As a result, they have the benefit of user experience, developer friendliness, and ecosystem incentives.

Chains that are not EVM compatible are more likely to grow into categories and niches where new ideas emerge. NFT, GameFi, and payments are all areas where incompatible public chains can thrive, an innovation that can also thrive in the DeFi market.

It cannot be concluded that EVM or non-EVM series are better overall. Instead, each case has different pros and cons, requiring developers to choose a public chain that fits their project development roadmap.

It is more important for DeFi users to evaluate the potential of the project using the development model from a different angle.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page