Blockchain Platforms for Smart Contract Development - Everything You Need to Know (2024)

Smart contracts require a blockchain network to be launched onto and executed in a predefined fashion. You can learn how smart contracts work, what you can use them for, and how to code them in our extensive smart contract blog post.

Choosing the right blockchain network is one of the most critical decisions for your smart contract development project. One factor to consider is the level of privacy and decentralization desired for a project. A public blockchain offers maximum decentralization and security but might lack the ability for individual customization. Private blockchains provide more development flexibility but might lack decentralization and security. Hybrid blockchains might be suitable for projects that want to benefit from the advantages of both public and private blockchains.

The “blockchain trilemma” is another factor to consider when choosing the right blockchain network. It includes three elements: scalability, security, and stability. Prioritizing two of these elements means the need to compromise on the remaining one in most cases.

There are countless blockchains supporting smart contracts. We cover eight major smart contract platforms in this comprehensive decision-making guide and show you the advantages and disadvantages of each platform.

What Types of Blockchains Exist for Smart Contracts?

Blockchain networks that support smart contracts can be divided into three main categories.

Public Blockchains

Public (also known as permissionless) blockchains are decentralized and open networks. No single party controls the entire network; anyone can join and participate in the blockchain.

Public blockchains use consensus mechanisms like Proof-of-Work (PoW) or Proof-of-Stake (PoS) to validate transactions or add new modules to the blockchain. Public blockchains are transparent, immutable, and impossible to censor, allowing for high trust and security.

Most public blockchains provide their cryptocurrencies (like Ether on the Ethereum blockchain). It is common for public blockchains to support smart contracts and decentralized applications (dApps), enabling complex programmable use cases.

Popular public blockchains include Ethereum, Binance Smart Chain (BSC), and Polkadot.

Private Blockchains

Private (also known as permissioned) blockchains have restricted access for authorized participants only. A single entity usually operates them for internal use only, such as supply chain management, internal record keeping, or identity verification.

Private blockchains benefit from high efficiency and scalability but may not offer the same standard of decentralization and security as public blockchains.

A popular private blockchain network supporting smart contracts is Hyperledger Fabric.

Hybrid Blockchains

Hybrid Blockchains combine features of public and private blockchains. They offer a balance between the decentralized nature of public blockchains and the control and privacy of private blockchains.

Using them to bridge different blockchains and ecosystems is common, facilitating interoperability between public and private blockchains. For many organizations, hybrid blockchains provide flexibility to allow for open blockchains in some cases and restricted blockchains in other cases. They are an ideal fit for sectors like health care and financial services, where a combination of private data protection and public verification is needed.

A popular hybrid blockchain supporting smart contracts is Avalanche.

How Do You Choose the Right Blockchain for Smart Contracts?

It would help if you considered several factors when choosing the most suitable blockchain to launch smart contracts. Among other factors, you should evaluate the technical capabilities of the blockchain, the degree of decentralization and security required, transaction costs and scalability, maturity of the ecosystem for developers, and supported smart contract use cases.

To help you make the right choice, here’s a list you can follow:

1. Define your project goals and determine the smart contract use case and application.
2. Consider the technical capabilities and scalability of a blockchain. What programming languages and tools does a specific blockchain support? What is the projected growth and transaction volume? For example, Solana or Polkadot might be a better choice than Ethereum when you need to handle high volumes of transactions rapidly.
3. Be aware of a specific blockchain’s consensus mechanism regarding security, speed, and cost. For example, Proof-of-Work (PoW) is highly secure but energy-intensive, while Proof-of-Stake (PoS) is more energy-efficient but compromises security.
4. Assess whether there is an active and engaged developer community You will have an easier time hiring talent, and developers can rely on the ecosystem’s wide range of tools and resources.
5. Consider the security and decentralization of a network. In general, public blockchains are more decentralized and transparent at the expense of higher transaction costs and difficulties in scalability. Private blockchains, on the other hand, usually give you more control and privacy but suffer in security and interoperability.

Most Common Blockchains for Smart Contracts

Countless blockchain platforms support smart contracts. We focus on the most popular and common platforms and provide their respective characteristics and advantages/disadvantages.

Characteristics of major blockchain platforms

Ethereum

Ethereum is the first and most popular platform for smart contracts. It is trusted and used by industry giants like Microsoft, JPMorgan Chase, and ConsenSys.

The main programming languages used on the platform are Solidity and Vyper. Smart contracts coded for this platform must first be compiled into Bytecode so that the Ethereum Virtual Machine (EVM) can facilitate the execution of the contract on the blockchain.

Currently, Ethereum uses a Proof-of-Work (PoW) consensus mechanism. With the ongoing upgrade to Ethereum 2.0, a transition to Proof-of-Stake (PoS) is planned.

What are the main benefits of Ethereum?

• Ethereum is known for its high level of security. Smart contracts are auditable and transparent due to the network’s decentralized nature.
• The network has a large and active developer community with an open-source ecosystem. It boasts a large variety of resources and tools, as well as documentation on how to use them. It supports the most common smart contract language (Solidity).
• With its wide adoption, the platform has many users and decentralized applications (dApps).
• Ethereum hosts the most decentralized finance (DeFi) applications, offering countless opportunities for financial innovation.
• The native token of the Ethereum network (Ether/ETH) is one of the most liquid cryptocurrencies. This makes it easy to finance projects on the platform and for users to engage with dApps and smart contracts.
• Smart contracts launched on Ethereum are not limited to basic transactions. The “Turing-completeness” of the scripting language allows developers to code smart contracts for a wide range of tasks, from financial agreements to supply chain management to real estate ownership.

What are the drawbacks of Ethereum?

• Fees required to compensate computing energy to facilitate transactions (so-called “gas fees”) are higher on the Ethereum blockchain than other blockchains. Fees are variable and can rise steeply in times of high usage and congestion on the network.
• High usage volumes (which can occur often due to the network’s popularity) can lead to congestion and slow transaction speeds. The update to Ethereum 2.0 is due to address these issues with better scalability, speed, and energy efficiency.

Binance Smart Chain (BSC)

The Binance Smart Chain (BSC) blockchain is developed by Binance, one of the world’s largest cryptocurrency exchanges. The primary goal of this network is to provide low-cost, high-speed transactions.

It is compatible with the Ethereum ecosystem and the Ethereum Virtual Machine (EVM), making migrating projects from Ethereum to BSC easy.

This blockchain uses a PoSA consensus mechanism, a hybrid of Proof-of-Stake and Proof-of-Authority, balancing decentralization, security, and scalability.

What are the main benefits of BSC?

• The BSC is known to be user-friendly, providing fast transaction confirmations and offering affordable fees.
• This blockchain has many use cases for smart contracts, from decentralized exchanges to gaming platforms.
• Like Ethereum, BSC has a rapidly growing and active community backed by the large Binance ecosystem.
• It is integrated with the ecosystem of Binance, including Binance Exchange. This makes it accessible to a large user base.
• The platform supports the programming language Solidity. The smart contract code is auditable and transparent on the blockchain.
• The network boasts additional features like cross-chain transfers and interoperability (allows for transfers of assets between different blockchains) and BEP-20 tokens.

What are the drawbacks of BSC?

• The level of security is lower than on more decentralized PoW blockchains.
• Due to the network’s growing popularity, especially in DeFi and NFT projects, it faces congestion risks. This makes transactions slower and more expensive but still cheaper than Ethereum.
• The network is highly dependent on Binance. Regulatory issues, outages, or changes in Binance’s terms could affect the BSC blockchain.
• The platform is less decentralized than some other blockchains. It has a smaller number of validators that are mainly selected by Binance.

Hyperledger Fabric

Hyperledger Fabric is a permissioned (private) blockchain focusing on privacy and control. Only authenticated and authorized participants can access this network.

It is made explicitly for enterprise use and thus can handle rapid transaction throughput due to its flexible consensus mechanism (organizations can choose the most suitable consensus mechanism).

The network’s modular framework approach permits customization and individual component integration of smart contracts for many use cases.

What are the main benefits of Hyperledger Fabric?

• The private nature of the blockchain makes it highly secure and scalable.
• It is a suitable platform for coding smart contracts due to its high interoperability.
• Hyperledger is an open-source platform with a strong community of developers and enterprise support hosted by The Linux Foundation.
• The network supports several programming languages to code smart contracts, including Rust, JavaScript, and Go(lang).
• Transaction processing or smart contract execution doesn’t require a cryptocurrency. This simplifies operations and avoids volatility associated with cryptocurrencies.

What are the drawbacks of Hyperledger Fabric?

• It is complex to set up and maintain the network. The blockchain’s modular and highly configurable nature requires significant expertise.
• The network has a steep learning curve due to its complex architecture and the requirement to understand Chaincode (Fabric’s equivalent to smart contracts). With the language of choice often being Go(lang) or Node.js, developers unfamiliar with these languages and the network’s unique characteristics might face significant challenges.
• Fabric allows interoperability with other Hyperledger projects, but it’s more challenging to interoperate with external blockchains (e.g. Ethereum, Bitcoin). It might not be a good fit for multi-chain ecosystems.
• Launching and running a Hyperledger Fabric network can pose higher computing power and infrastructure requirements, especially for large networks.

Solana

The Solana blockchain network is known for its high-speed transactions and low fees. It is highly scalable with a fast throughput, allowing for thousands of transactions per second.

Solana’s unique consensus mechanism (Proof-of-History combined with Proof-of-Stake) contributes to fast transaction processing times, enhancing user experience and efficiency.

The network has a rapidly growing ecosystem of decentralized applications (dApps), DeFi platforms, and NFT marketplaces.

What are the main benefits of Solana?

• Solana’s unique consensus mechanism makes the blockchain more energy-efficient than PoW-based blockchains.
• Smart contracts launched on Solana must be written in Rust. Due to the programming language being intrinsically technically correct in its coding, executing smart contracts on the blockchain conforms to high security.
• Smart contracts can be processed in a parallel fashion on the blockchain. Even without confirmation of the blockchain, they can provide cryptographically secured outputs. This also increases efficiency and speed.

What are the drawbacks of Solana?

• Solana is less decentralized than other blockchains like Ethereum or Bitcoin. One reason is the high hardware requirement for running a validator node, limiting the number of validators.
• The Solana network is still a relatively young ecosystem and thus offers limited resources, tools, and support for developers.
• The blockchain requires knowledge of the “low-level” programming language Rust to code smart contracts. This language is relatively difficult for developers to learn and adapt to compared to Solidity.

Polkadot

Polkadot’s key characteristic is the interoperability between different blockchains. Smart contracts on Polkadot can interact with other blockchains (cross-chain compatibility).

This blockchain uses a Proof-of-Stake consensus mechanism, which is more energy-efficient than Proof-of-Work.

Developing custom blockchains (Parachains) within the Polkadot network is possible. Polkadot is particularly suitable for developing dApps that require cross-chain functionality and interoperability.

What are the main benefits of Polkadot?

• The blockchain is highly scalable without compromising performance by connecting several parallel blockchains (Parachains) with a common security layer (the Relay Chain).
• The network provides a high level of security.
• Polkadot supports a wide range of programming languages and frameworks.
• Due to its sophisticated governance model, Polkadot allows its community to make certain decisions.
• A strong ecosystem and an active community of developers and supporters back the blockchain.

What are the drawbacks of Polkadot?

• Polkadot has a complex ecosystem, with its architecture based on Relay Chains, Parachains and Bridges. It can be difficult to learn and adjust to for newcomers in the space.
• Securing a slot for a project to become a Parachain can be competitive and expensive. This can be a significant obstacle, especially for smaller projects with limited resources.
• Polkadot’s high level of scalability originates mainly from its shared security model. This means a certain degree of centralization, which might not be suitable for projects prioritizing maximum decentralization.

Cardano

Cardano is a blockchain and smart contract platform based on the Proof-of-Stake consensus mechanism. It is more energy efficient than blockchains based on Proof-of-Work while maintaining a high transaction throughput.

The network emphasizes security and privacy, requiring formal verification of the smart contract code that enhances code correctness. This reduces potential points of attack in smart contracts.

Cardano is unique in its development, driven by academic research and peer review, providing high credibility. The network supports several programming languages (Plutus, Marlowe).

What are the main benefits of Cardano?

• The network offers high scalability and throughput.
• It is known for its energy efficiency and sustainability.
• Cardano can seamlessly integrate with other blockchains, offering high interoperability and allowing for cross-chain communication.
• The network supports a broad range of use cases, including developing dApps.

What are the drawbacks of Cardano?

• Cardano is still at an early stage concerning smart contract capability compared to established smart contract platforms like Ethereum. This means that the ecosystem for dApps and developer tools still needs to be improved.
• Cardano smart contracts are mainly written in Plutus, a programming language based on Haskell. This may be a challenge for developers not familiar with this uncommon ecosystem.
• The methodical and research-driven approach of the blockchain, while favorable for security and credibility, can lead to slower development and feature rollouts.

Avalanche

The Avalanche network is based on its unique Avalanche consensus mechanism, which is energy efficient. This consensus mechanism is designed to conform to high security standards and resistance to attacks.

The network is renowned for its high scalability and performance. It allows the creation of subnetworks and customized blockchains.

What are the main benefits of Avalanche?

• The network offers exceptional transaction throughput with sub-second confirmation times and low transaction fees.
• Various use cases are supported, from gaming to financial applications.
• The blockchain is compatible with the Ethereum Virtual Machine (EVM).
• The platform offers rapid and efficient smart contract solutions with fast execution.
• Avalanche is technically supreme (in terms of transaction costs and speed) and a strong competitor to the Ethereum network.
• It offers an adaptable and scalable environment for smart contract development due to its multi-chain ecosystem.

What are the drawbacks of Avalanche?

• The network is relatively complex with a unique architecture, using multiple blockchains (X-Chain, C-Chain, and P-Chain). This can be challenging for developers who are more familiar with other ecosystems.
• Avalanche’s native token, AVAX, offers limited liquidity and exchange support compared to more established cryptocurrencies.

Bitcoin

The Bitcoin blockchain supports a specific type of smart contracts. However, it is important to note that smart contracts on the Bitcoin blockchain are very limited in their capabilities compared to more popular smart contract platforms like Ethereum.

Bitcoin’s smart contract language, Script, is intentionally limited to conform to high security standards. It doesn’t support loops and is not “Turing-complete” (unlike the smart contract programming language Solidity). It can be used to process and validate transactions but can’t solve complex computational problems. It doesn’t support the development of complex decentralized applications (dApps).

Bitcoin smart contracts are more basic and less flexible than those of many other platforms. Launching smart contracts on the Bitcoin network may not be convenient for projects looking for solutions beyond basic transactions.

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