*obligatory not financial advice*
Secret Network is a blockchain that is part of the Cosmos IBC protocol and provides smart contracts with Monero’s level of privacy. If you want to learn more about Secret Network in general then please read my original article about it. Here I only want to talk about a few issues the chain is dealing with in the last few days.
What kind of problem does Secret Network have right now?
In short, the blockchain is overloaded with transactions from the long anticipated and popular Shade airdrop. Shade protocol is a dApp on Secret that makes it possible to mint a decentralized algorithmic stablecoin and will build many more DeFi applications that are all utilizing the default privacy of the Secret Network blockchain.
Private DeFi could become a huge deal and there are very few projects working on it. So when Shade announced that they will drop some of the native token to SCRT, ATOM and LUNA stakers, it has sparked a lot of interest across the entire Cosmos network. The airdrop became finally claimable this week on the 21st of February 2022, and countless qualified addresses started to claim the first 20% of their new SHD tokens. Sadly, this turned out to be too much for Secret to handle and the cost for transactions and the time they needed skyrocketed.
Many people had to wait more than 12 hours before their claim finally went thru and many people that finally got their tokens had to wait a few days to finally be able to create the necessary viewing key to be able to see the token in their wallet and use it. The airdrop did draw a lot of attention to Shade protocol and the developers took the opportunity to explain their project to the newcomers, but the airdrop was a huge mess early on because the Secret Network blockchain couldn't properly handle all the transactions, (also the amount of airdropped tokens was bit low but that’s a different issue).
This has put the spot light on a fatal flaw with Secret, it’s not scalable enough!
What will happen now with Secret Network?
The developers of Secret Network have addressed the problem in a recent blog post.
In short, they are saying that the main reason for the problem is that the nodes were still using an outdated engine that can't handle long computations efficiently. This is a problem that they were aware of for some time now and they are already working on a solution. They are in the final stages of testing an update that will allow nodes to both handle more transactions and handle long computations better. This update will be implemented without a hard-fork, so the nodes will be able to use apply it instantly. They are actively working to improve the execution performance and also the gas calculation and pricing of transactions.
The first upgrade will be released within only a few days and after that they will continue to work together with validators, users and dApp developers to build further improvements.
What about the SCRT coin?
There has been a small dip since the Shade airdrop that is surprisingly small. This could be because many SCRT coins are being staked and there is a 21 day unstaking period, which means that the coin could soon start to seriously dip in a few weeks should the coin holders not be satisfied with the state of the blockchain soon.
Since the developers are working on the issues and there will not be another big airdrop soon, such scalability issues will hopefully disappear and the Secret Network blockchain will improve for the better. The first update for the blockchain will be released soon, so there might not be any major dip caused by the recent Shade fiasco.
However, there is another blockchain that offers privacy in smart contracts and is also part of the Cosmos IBC protocol called Oasis Protocol and the recent problems of Secret could bring some attention to it and its ROSE coin.
I know that this post is a lot different from what I usually write but I thought its important information for anyone who is interested in Secret Network.
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