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I am researching Ethereum as I am looking for a way to create a new digital currency to support a franchise business. I am currently installing and trying Truffle which, if I understand correctly, will help me write Smart Contracts in Solidity (the Smart Contact language?).

I also came across a small venture called Colu which uses the Bitcoin's blockchain to create assets. As far as I understand, it is done by making micro-transactions on the Bitcoin network and using the description of the transaction as a Database (Please note I am rather new with Blockchain terminology).

I want to choose a blockchain which I can rely on for years to come. I am wondering what are the cons and pros of each blockchain ecosystem?

To my current understanding, using the BitCoin's Blockchain as a database is in a way a hack and the newborn currency is prone to be effected by Block size changes and fluctuating transaction fees. Yet, I feel I am missing something and that to better understand Ethereum I should better understand the alternatives. So basically my questions are:

  • What is the proposition of Colu and services like Colu? Are they bassicaly saying "Bitcoin is solid, jump aboard"? hence building on top of Bitcoin's blockchain maturity rather than its fit to hold digital assets?

  • Is it simply the "old way" vs the "new way"?

  • Are services like Colu simply a kind of blockchain-enablers bringing non-tech people closer to blockchains (any blockchain) via abstraction layers and Frontend tools?
  • As a programmer, what are the benefits of simply skipping those convenience-services and starting a crypto-currency on top of Ethereum? Am I more likely to make mistakes which would be hard to correct in the future?

Answers to those questions can help me orient myself in this new world, thanks!

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Broadly speaking I would say the key difference is, that the functionality of bitcoin is relatively static and all you can do is defined in the protocol. As where in Ethereum the protocol defines a VM that allows you to deploy arbitrary logic, so it's on-chain functionality is comletly dynamic.

Color coins I think is a thing that can be done relatively clean on top of bitcoin since it uses the basic functionality of bitcoin to transfer coins. It just need something like for example this Colu engine to make a special interpretation of normal bitcoin transaction. If you'r already sure that this is all you'll ever need in your case, basically transacting tokens between bitcoin addresses, then this probably a good and easy solution.

However, if you want to do more complex things with your tokens, like letting token holders vote, sending dividends to them, having the tokens decay over time or any other thing requiring some sort of logic, your probably better off with ethereum. In the "on-top of bitcoin" solution, these things would need to be implemented in Colu engine, but I'm not familiar enouth with Colu to say if it contains some sort of scripting platform or if this would need to be done in the main Colu code.

As for reling on for years to come, that's difficult to predict with all blockchains at this point I think. With bitcoin being some what mature but pretty regide and not really open to fundamental changes anymore. Which in my opinion means, betting on bitcoin as a platform, is betting that everything that might be needed on a fundamental level in the future is already in there today. With Etereum on the other hand a lot of fundamental things are still wide open, under development and unclear how they will turn out over time.

I don't think of it as the "old way" vs the "new way", for me it's more "specific purpose blockchain" vs. "general purpose blockchain". Bitcoin was not designed to be a TCP/IP-like bottom layer to build all kind of stuff on top (despite many describing it like that). It was build for a specific application.

I do think services like Colu are supposed to be blockchain-enablers, but in a way they also keep non-tech people form tiping there toes in to the real decentralized things and kind of blure the lines. To be fair, I haven't looked to deep into Colu and may misrepresent what they are doing, but if you have to sign-up there with you email address and create a account to start your crypto currency I would be doubtfull if this is something enabling and educating non-tech people for bockchain apps. If on the other hand Colu provides a slick easy to run client/wallet with there colu-engine in it or whatever, that would in my opinion be a real enabler.

From a efficiency stand point I don't think there is any benefit implementing your own thing compared to use a existing service. The only reason to do this is when you have requirements that no service/app provides yet. It is also inefficient to use blackchains at all when there is no need for a truly decentral solution, just using a RDBMS is way more efficient and reasonable, when the end-user can only interacts via. a centrally hosted webapp.

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