The origin story of the founders {(Chepurnoy, Alex),(Meshkov, Dimitry)} begins in 2015. The two of them were working together on a project, Scorex, a modular blockchain engine framework created to produce systems and test them as fast as possible, along with fast prototyping and experimentation (Chepurnoy, 2016). This project caught the attention of Cardano and Ethereum co-founder Charles Hoskinson. This is when Alex became one of the first employees at IOHK, an engineering and research company that builds blockchains and cryptocurrencies. Alex became the Director of ScoreX projects, managing developers and writing code out of passion. Dimitry followed soon after, deploying R&D for IOHK. He was focused on a framework for blockchain prototyping. In 2017, the two of them began the developing what would become, Ergo. They spent two years working through problems within the Bitcoin accounting model, known as the unspent transaction output model (UTXO). They intend to maintain a grassroots approach with organic marketing through various outlets. Ergo is a resilient platform for contractual money.
Ergo launched July 1st, 2019. Alex Chepurnoy is the Co-Founder and Core Developer of the Ergo Platform. Alex has written over twenty academic papers and has more than fifteen years of experience in Software Development. He was also a Core Developer for NXT, and co-founded smartcontract.com, now known as Chainlink. Dimitry Meshkov is a Core Developer on Ergo. Dimitry has a PhD in Physics and over ten years experience in software development, and has written several peer-reviewed papers on cryptocurrency.
Ergo is dedicated to the original verison of Bitcoin Proof-of-Work. New protocols are trying to acheive high throughput, complicated smart contracts, etc. while sacrificing decentralization. Ergo maintains a rigourous research and scientific approach to the issues they are attempting to solve. In December of 2019, Ergo had more than 500 million in Ethereum locked as collateral in contracts. They do not seek investments for Ergo itself, rather they seek investments for projects or applications launched on Ergo. (Chepurnoy) The Ergo Foundation released thier manifesto on April 26th, 2021 and can be quoted saying "The current state of the market is a little sad. We need to get back to the roots of the crypto revolution, decentralized tools that are private and secure, drive real-world adoption of these systems. The ideal is to create tools that help people create value".
Ergo's offcial website states what financial issues they are working to resolve, "Ergo is a next-generation proof-of-work platform that enables new models of financial interaction, underpinned by a safe, rich scripted language. Built with flexible and powerful zero-knowledge proof sigma-protocols." Ergo provides a decentralized ecosystem, with an outstanding programming foundation, that is open source and permissionless. Trust and adoption of this technology could lead to unbanking yourself from most third-party intermediaries (Ergo Platform).
Ergo was created to cater to the small buisness owners and everyday people from all across the globe. The founders are attempting to attract regular people to adopt the technology. "Ergo is committed to being a tool for regular people, thier interests shall not be infringed upon in favor of big parties." (Ergo Manifesto) They participate in organic community building by not paying for major advertising. Instead, the team took the grassroots approach and are slowly building up a YouTube channel with weekly video Ask Me Anything's, developer updates, etc. They also have a community wiki, github, twitter, telegram, discord, reddit, and forum that is growing.
Ergo is a Proof-of-Work cryptocurrency with a fair intial launch. Ergo was mined from zero via PoW with no intial coin offering. Miners have first dibs as miners are minting Ergo into existence before it ever hits an exchange. Luckily, the founders developed a PoW algorithim called Autolykos that efficiently mines ERGO on lower quality GPUS. So much so, it is possibe to mine Ergo on a cellphone, and sent directly to a secure wallet if the node is setup correctly. In the mining market, Autolykos is the first ASIC-resistant and pool resistant consensus algorithim to be deployed. Mining in Ergo requires much less energy than larger competitors like Bitcoin and Ethereum. Ergo prioritizes thier miners, incentivizing them to continue to mine when hypothetically, they could mine Bitcoin or Ethereum at a higher profitability rate. They incentvize the miners by allocating voting power to miners based on the hash rate of the users mining rig setup.
Remember that Silicon Valley show, the one about data compression? Ergo did just that for the blockchain, calling them NIPoPoWs (Non-Interactive Proof of Proof of Work). The application is to dramatically reduce the size of a blockchain. Ergo Platform released an article on NIPoPoWs stating "Bitcoin's blockchain is over 300 GB. Due to its smart contracts, Ethereum's blockchain is almost a Terrabyte! Anyone wanting to run a node will need a sizeable harddrive and wait between 1 to 5 days for the node to sync. NiPoPoWs will allow super light clients to sync to the blockchain with less than 1MB of data. NIPoPoWs will enable limited technology, such as flip phones, to operate with limited data service, and achieve the same security level as running a full node. This has the potential to completely revolutionize the industry."(Ergo Platform, 2022) NiPoPoWs essentially condenses the blockchain down to "super blocks" that contain more zeros than average blocks. Each block between the last super block and the next super block are compressed. Super blocks are sufficient to provive the user with reliablity and security while interacting with the blockchain.
Developers have created some very useful applications built on top of Ergo. The most notable being a decentralized exchange (DEX) called ErgoDEX co-founded by Ilya Oskin. The DEX holds some useful tokens, I will briefly share a few applications:
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SigUSD is a decentralized stablecoin backed by Ergo, overcollaterallized by 400% to 800% reserve ratio. "A reserve-backed model is a superior model in preventing cascading liquidations during extreme volatility"(Ergo Platform, 2022). In other words, when the price begins to fall and users are liquidating thier positions, the stablecoin will hold its peg to the dollar.
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ErgoPad is a token launch platform for Ergo, giving the user an opportunity to get in on the ground foor with Ergo token Intial DEX Offerings. They help projects navigate ErgoScript to build safe apps for all.
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ErgoLend is a P2P lending platform with easy to use tools to borrow and lend money on the Ergo Blockchain. The goal is to leverage blockchain technology to create a golbal lending platform. With lower borrowing costs, smaller loans become viable. This opens up a large, untapped market of borrowers.
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SkyHarbor.io is the most popular site recently created for purchasing Ergo NFTs, similar to OpenSea.
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Sigmaverse.io is a one stop portal to the Ergo Decentralized application ecosystem: a place where users can find all the cool funcitionality that community developers are building on Ergo, all in one place.(Sigmaverse, 2022)
Ergo is in the FinTech domain of Blockchain and Cryptocurrency. Major innovations of the last 5-10 years in this domain has to be the success of Ethereum, the open-source and smart contract functional cryptocurrency. It's ability to create custom tokens on Ethereum allows NFTs to exist, which directly influenced the NFT boom with CryptoPunks in 2017, and Bored Ape Yacht Club in 2021. Proof-of-Stake would be another innovation in the short term that has gained popularity. Major currencies in the space are Bitcoin, Ethereum, Cardano and potentially risky stablecoins that people trust.
Based on these developments, I would state thier buisness impact has been positive and developing well. Some of basic measures of success in blockchain and cryptocurrency include:
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Number of Blockchain Addresses
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Number of Transactions Per Day
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Average Daily Transaction Volume
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Market Cap
Bitcoin has 624,229 unique wallet addresses holding BTC (data.nasdaq.com). The number of transactions per day is 259,429, the circulating supply is 19,080,072 Bitcoin, the block reward is 6.25 Bitcoin per block discovered with a hashrate of 213.141 EH/S.
Ergo has 139,216 unique wallet addresses, the number of transactions per day is 6,749, the circulating supply is 56,775,939, the block reward is 51 ERG per block discovered with a hash rate of 16.08 TH/s (ergo.watch).
It is clear that numerically, Bitcoin is far superior. Coinexams.com wrote an article comparing the utility of Bitcoin and Ergo, in which they stated, "...In addition, Bitcoin is used relatively more in transactions, likely because it is relatively older. Given Bitcoins utility, its marketcap of 364.8 billion indicates it is most probably overvalued compared to Ergo which has a marketcap of 106.2m..." "...As for inflation, Bitcoin has about an 8 times lower inflation rate compared to Ergo. It is worth noting that Ergo has a huge inflation rate of 13.1 percent, but expected to be more moderated in the near future." One statistic that Ergo is much more efficient on is transaction fees. Bitcoin is around 1.26 dollars per transactions, where Ergo is .01 cent. Speeds to execute transactions are relatively the same.
I would paint the picture as Bitcoin being the older and more popular sibling, while Ergo is the younger sibling that looks up to Bitcoin has a role model. Ergo attempts to iterate why Bitcoin became popular initially. Ergo maintains the morals and values of the original Bitcoin vision and continues to innovate on top of that. Commercial adoption is what Ergo needs to start taking bigger strides in the market. Ergo is prepping itself for the elusive Ethereum proof-of-stake merge. Ethereum miners will need a place to go once the currency transitions to proof-of-stake. Ergo would like to acquire a majority of the hashrate of those miners, when miners will be forced to mine another cryptocurrency or sell equipment.
If I were to advise the company about a product or service to drive commercial and residential adoption, I would present something that competitors already offer but not developed on Ergo's platform. It would be a P2P ownership application, to buy and sell land/housing deeds through smart contracts without the need of extra fees from intermediaries. The blockchain is not able to be edited, so as long as the owner of the wallet address holding the contract token maintains access to the wallet, they own the property, as confirmed by the blockchain.
I believe this product would benefit the company because it would drive commercial adoption due to interest of lower transaction fees without the need for third party intervention. This platform would utilize the technology of Ergo and would surely increase the daily transaction output, daily transaction volume, and increased marketcap due to commercial and residential adoption. The technology is appropriate to my solution as it checks all the boxes Ergo needs to improve upon.
In conclusion, Ergo is a store of value, not worse than Bitcoin due to similar PoW, supply cap, and fixed monetary policy. The currency has a solid developing team behind it with a great set of fundamentals. The probability of ergo performing well over time is more likely to occur than other comparable alternative coins. Ergo requires applications to be built to encourage mass adoption. It is possible to be the person to build a simple, yet effective application on Ergo's platform that can be widely utilized.
Resources for report: Alex Chepurnoy - Ergo Platform: A resilient Platform for Contractual Money and Decentralized Finance, YouTube Ergo Platform: From Prototypes to a Survivable Cryptocurrency, Dimitry Meshkov, YouTube Ergo Platform Ergo Manifesto, Ergo Platform Portal to Ergo Dapps, Sigmaverse ErgoPad: Ergo's First IDO Platform, Ergo Platform NiPoPoWs on Ergo: Innovations in Blockchain, Ergo Platform Ergolend: P2P lending platform Ergo's AgeUSD Protocol: SigRSV and SigUSD, Ergo Platform Ergo and the Autolykos Consensus Mechanism: Part 1, Ergo Platform Skyharbor, Premium NFT Marketplace on the Ergo Blockchain Ergo Statisitics Weekly Update & AMA - June 24, 2022, YouTube Dev Update June 26, 2022, EIP-27, Rosen Bridge, GraphQL, and more, YouTube Roundtable with Charles Hoskinson and Alex Chepurnoy, YouTube Alexander Chepurnoy, IOHK Research - Scorex, YouTube Compare Crypto Utility: Bitcoin vs. Ergo, CoinExams Bitcoin Price, Stats, and Information, BitInfoCharts