Since the start of the new technology in the blockchain industry, many people are trying to get the first mover advantage. Ethereum is the new hype after the Bitcoin and many people are trying to capitalize the opportunity to generate profits. However, while opting between the two simplification plays a major role to decide on where to invest. Especially when you have long-term plans, a simpler product would win hands down.

The applications for these technologies are apparently decentralized, due to which investors and technology creators should ponder upon whether these decentralized applications actually hold any benefit over a centralized model.

Below, you will find reasons that why decentralized applications like Ethereum can triumph over centralized models.

1. Contracts Always Execute Like Written

Whenever a human layer is involved with a contract the chances of it getting enforced as written gets limited. That is the major problem with a centralized model; it needs to get approved by a legal entity and the confidence of the contract getting executed exactly like it is written is low. However, on the other hand when a contract does not have any additional layers of execution the business have no worries with regards to DAO (Distributed Autonomous Organization).

And that’s not it, in a decentralized model there is no extra layer of human and technology which makes it slightly less expensive as there is no need to manage employees within a certain role to ensure that they are process oriented. Thus, this given Ethereum as vase area to expand and strengthen their capabilities, making it a growing network.

2. Crowdsales and DAOs

Many new firms are leveraging the capabilities of Ethereum to crowdfund their business, for instance, Digix was able to crowdfund over USD 5 million for their business. Digix is a gold tokenized Dapp, which was able to generate enough capital purely through Ethereum’s network to grow their business.

This showcases that with the help of DAO crowdsale on a Dapp a business can easily grow and raise funds for its business without any needs to banks or any investors, especially when raising funds or investing in a startup can be a daunting process.

A realization is required, however, by the nationals or international entities of the capabilities. Although we are already seeing a change in the acceptance of the Bitcoin around the world. Additionally, a DAO can also be of any kind. It can vary from an online business like Digix to people coming together to open a neighborhood coffee shop.

Furthermore, a DAO can help in controlling corruption as we see lately in many shell businesses that try to hide their money overseas. DAOs can serve as an alternative to these problems as people are able to discover the optimal business models as it is dependent on the people.

3. Automation and low-to-no-cost

Automation in Ethereum has helped in cutting down the costs to almost zero because an entire business can be executed automatically. Even though there is some cost involved when operating a DAO for the execution of the smart contracts, however, these costs will be very minimal as compared to a business that involves overhead costs of office, staff as well as the infrastructure facilities to run any traditional centralized business.

Another advantage of Ethereum is that the capabilities of it are still to be understood apparently since the technology and ecosystem are still very new to the world and it requires a lot of growing. For its further improvement, new ideas will eventually come up for the Dapp so that the techniques followed at the current times will seem to be completely inadequate.

To support the point, there is already an exchange called EtherEx that will issue tokens to raise money and would have a voting system in place for their proposals of EtherEx exchange.