Elrond: What happened to the promises?

Highly visible in France thanks to ultra-aggressive marketing, the Elrond project has still not delivered everything it promised in 2020. The Romanian blockchain company is hoping to bounce back by focusing on metaverses.

In the crypto ecosystem, there's one question that puts a blockchain project under the microscope: what are its strengths? 💡

When specialists are asked about the "strong points" of the Elrond project, the answer is often the same: "They're very good at marketing", "They have a great community", "The token has taken off well"... In short, the comments are dithyrambic.

But on the substance, things are a little more complicated. "It's yet another blockchain trying to compete with Ethereum by presenting itself as more scalable and simpler to use," explains one expert.

"They were the first to use sharding (a technique that increases the number of transactions per second, editor's note), but that is their only argument and the comparison with Ethereum is not really to their advantage," adds Stanislas Barthélémi, blockchain consultant at KPMG.

In this respect, it's hard to prove them wrong: there are around 1.9 million addresses on Elrond, while Ethereum (the second largest blockchain on the planet) boasts almost... 210 million!

This figure obviously doesn't measure the number of users, as a single person can have several addresses, but it's still a good indicator of a project's "success" 🏆.

"Elrond comes up against reality: the protocol rarely exceeds 80,000 transactions per day, whereas Ethereum can handle more than a million," says a good connoisseur of the project, who preferred to remain anonymous because the Elrond community is very active (more on this below).

Another interesting element: the number of new addresses created every day. On Elrond, we're talking about 1,000 addresses, while 90 times as many are created on Ethereum!

And the exercise also works - it's even more blatant - with Solana (140,000) and Polygon (up to 1 million a day!The Elrond network was launched in the summer of 2020 by the eponymous start-up based in Romania. Like many new projects, its token experienced a meteoric rise in the middle of the Bull Market (remember containment).

The EGLD rose in one year from $13 to around $540, in November 2021 (+4054%). Since then, the "Bear Market" has come and gone, and the EGLD is hovering around $60, but it has settled in well, also because it promised quite a few things ✨.

One of those promises was a kind of financial app, which some were quick to compare to a neobank like Revolut. This application? It's called Maiar.

Maiar lets you buy and sell EGLD (but also a few other cryptos such as bitcoin and ether), send them to friends and family or even make them grow in staking services. We've tried it out and, honestly, it works really well.

The app could soon be complemented by a payment card, particularly since the March 2022 takeover of payment company Twispay 🇷🇴, which has a licence to operate in most European countries. In fact, bankcard giant Mastercard is one of the headliners at the major X Day conference being held in Paris 🇫🇷 from 3 to 5 November...

"This is the first blockchain to offer such a good user experience," points out influencer Owen Simonin (Hasheur), who was one of the first to back the project. "When you look at what Avalanche or Polkadot offer, it's very raw, and I'm not even talking about Tezos which is particularly difficult to get to grips with," he insists.

 And beyond the Maiar application?

Big projects can be counted on the fingers of one hand, even if his launchpad (a platform for financing applications built on Elrond) holds the promise of future innovative applications. We're in the very early stages," says Owen Simonin, "and many projects won't see the light of day for another five years. We need to let people work."

On the decentralised finance side (DeFi), its Maiar Exchange decentralised exchange is capturing all the value ($160 million, compared with $32 billion on Ethereum spread across 592 services).

"DeFi is not up to scratch and we're seeing the same type of NFT projects as on many alternative blockchains," tackles an industry expert. "If Elrond's only arguments are that there has been sharding for three years and that the marketing is polished, what good are they?", adds Stanislas Barthélémi.

Happiness and Just Mining, a winning choice

In reality, and for the moment, where Elrond excels most is in the storytelling and the "possibilities" of the project. A storytelling skilfully maintained by the Hasheur teams, whose influence on the French-speaking ecosystem is considerable (cumulative audience of 1.3 million followers on social networks).

Many discovered the protocol with its presentation video published in June 2020. "Some have realised gains of between 5 and 6 figures after seeing my content. This is the project that has made the most money for my community", says the youtuber. And between Hasheur and Beniamin Mincu, the founder of Elrond, the story is not new.

The two entrepreneurs met a year and a half before the launch of EGLD. "At the time he wasn't well known and was interested in me talking about Elrond in a video, I hadn't really spotted the potential of the project. It was only later that I decided to get more involved," he says, emphasising the Romanian's visionary side, which reminds him of "Steve Jobs" with his desire to simplify things as much as possible.

Today, Owen Simonin's (Hasheur) company, Just Mining, accounts for 6% of the network's governance. It is the largest contributor behind giant Binance (8%) and the Elrond protocol foundation (21%).

For the Metz-based start-up, this represents around $48 million of EGLD tokens under management on behalf of its customers. Last November, this represented the equivalent of $430 million!

Their relationship doesn't stop there. Because beyond the staking, Owen Simonin has become a key player in the Elrond ecosystem. Communication, marketing, choice of partners... it's all there! "When Elrond wants to make a public announcement, I'm pretty much the conductor," continues the young entrepreneur. Communications giant Havas is also an important link in the chain. And the results are in!

Elrond has enjoyed very wide coverage in Europe from the outset, especially in France. "When you search for hits in Google, it's very rare to find articles that don't look like advertorials. Even when there was a hack last summer, the consequences were often played down," says one industry player. "What's disturbing is that the general public is very exposed to this content, which is devoid of nuance and criticism," laments another specialist who requested anonymity.

Owen Simonin says he invested "very early on" in the Elrond ecosystem 💸. "When the project succeeds, it succeeds for me too", he testifies, even though he sometimes gets negative comments when the token price experiences turbulence. "That's the business, I'm used to it," he tempers, while Elrond represents a significant weight in the business of Just Mining, but also of Hash Consulting, its marketing agency that supports projects in the crypto ecosystem.

Elrond remains a lightweight outside France and Romania

This in-depth work carried out by the communications teams has had a big impact on social networks, particularly Twitter, which is something of a go-to place for crypto projects.

"1.4 million tweets in a year and peaks of 25,000 on certain days is very impressive," explains Antoine Khaitrine, co-founder of Licter, a firm specialising in social data analysis. "By way of comparison, French-language conversations on Elon Musk and Twitter were just over 30,000 publications on a daily basis in recent days," he continues.

A large proportion of the discussions about Elrond thus revolve solely around "positive" topics. Comments are 13% more positive than when it comes to Ethereum and 17% when it comes to Bitcoin, according to exclusive data from Licter.

Also according to Licter, questions related to security issues thus account for just 2% of conversations on Twitter 🙃. And another interesting point: 40% of recent tweets about Elrond come from just 1% of accounts.

"Thanks to Hasheur's talent, Elrond has managed to unite a fine community in France in addition to Romania," confirms Stanislas Barthélémi. "That's a good thing, but these two countries aren't enough to create an ecosystem strong enough to carry weight globally, and I haven't identified any other influencers as important as Hasheur to support the project in other languages", he notes.

"After that, you might wonder whether it's really essential to use this strategy to raise awareness of a project. Notoriety is all very well, but if that's all there is to it, it's not going to get you very far", one expert tackles.

The metaverse gamble

To respond to these criticisms, Elrond is now taking the metaverse gamble (see exclusive interview with Beniamin Mincu below). Initially imagined as a global infrastructure blockchain, the project has chosen to pivot on virtual worlds where its technical capabilities can be put to good use 😎.

A perspective that convinces Hasheur: "Having a scalable blockchain is not an end in itself, the most important thing is to have use cases and meet needs. What bothered me at first about Elrond was that it could be used for a bit of everything, now they're in the process of specialising, it will please some and not others, but at least the path is mapped out and they'll see it through."

Some people, however, are much more sceptical. "I don't have a crystal ball, but I don't see Elrond coming back into the race", anticipates a player in the ecosystem.

"We've rarely seen protocols come back to the fore, because users are constantly looking for something new in altcoins", insists Stanislas Barthélémi. Will Elrond's bet on metavers be enough to reverse the trend? That's the other question that will put the project under the microscope in a few months.

Everything that matters in Web3. Each week.
25€/month
12.5€/month
This offer is available until the 30.04.2024. Try insider for free, for 30 days.
Subscribe
All that matters in crypto.
Deciphering, insights, Data. Access the best of the ecosystem.
Subscribre
In this article
No items found.
Read next
No items found.
In this category