Let me start by stating I have been a very long-term DIE HARD Ethereum fan throughout the ages! When Ethereum hit the cryptocurrency industry, not many people could even understand why this “OS” type blockchain will be sooooooo important to the overall ecosystem. As time progressed, users started to realize what Ethereum could offer as it started to open up thousands of new opportunities to take the decentralized ledger.
However, one thing that has been concerning me as of late is this overarching issue with scalability. We all know Ethereum is slow. Very slow. 25TPS? Jheez! Extremely slow! We all know this too well when the CryptoKitties hype started which caused the entire Ethereum blockchain to clog up creating a backlog of transactions and extremely increased transaction fees.
However frightening this may seem, this scalability fear is something that Vitalik Buterin, Ethereum co-founder, is also concerned about.
Buterin Talks Scalability
In a recent interview with the Star, Vitalik mentioned that the Etheruem blockchain is almost full again and that this is a big bottleneck to the Ethereum ecosystem as it creates a self-fulfilling problem. If a new project wishes to join the Ethereum ecosystem they will do so by knowing that the blockchain is already pretty much full and therefore they will be competing for transaction space - which is already pretty damn expensive! Furthermore, a new project will also know that once they enter the Ethereum ecosystem, fees will only increase as they help to fill the blockchain.
This creates a dilemma for new projects to enter the Ethereum ecosystem at this moment in time. Developers have the option to switch to other blockchains (or decentralized networks) such as Tron, EOS, and IOTA (the most likely option). If the projects choose to join these networks, they will not be adding to the problem that exists on Ethereum which will lead to them having a greater probability of success.
So What Is The Solution?
Vitalik begins by stating that on the current Ethereum blockchain, computers have to verify each and every individual transaction that is transmitted across the blockchain. Vitalik believes that we need to move to a model that allows the computer to verify small portions of all the transactions on the blockchain.
Although this may compromise the security of the Ethereum network, this new model would help to decrease the transaction fees by up to X100, a wager which Vitalik believes will be beneficial the overall network. However, with scalability issues extending years, some may come to the question if blockchain is really the right technology to be using.
Is Blockchain a Dinosaur Tech?
So is blockchain really an outdated technology? Well, let’s start by explaining what other options are out there. The IOTA project uses something called a DAG (directed acrylic graph) which is called Tangle and is completely different from the blockchain. Instead of having miners verify each transaction that enters a block on the blockchain - the Tangle network requires its users to verify transactions from other users creating a “web” effect instead of a “blockchain”.
This difference allows for a more fluid and scalable network. Furthermore, the Tangle network gets more powerful with time - which is completely the opposite to blockchains which get slower as more transactions are added. Transactions conducted on the Tangle network are also completely FREE. This is largely due to the fact that miners are not needed to verify the network which also means there is no block reward on Tangle.
These reasons are not enough to call blockchain a “Dinosaur Tech”. The Blockchain has been around for over a decade now which means that it has had many years of testing in which the blockchain has still not been broken. This proves that blockchain technology actually works. It is hard to develop the same trust with Tangle as we will need some more time to test if the network is actually as secure as the blockchain. However, after saying this, I still believe that IOTA is a very EXCITING opportunity to be the “next version” of the blockchain.
With having such a fluid and scalable network, this allows for mass usage across the mainstream population. The mainstream will not use traditional blockchains as they are today due to the fact that once everybody starts to use it - it becomes EXTREMELY slow and expensive. On the other hand, the majority of the same applications can be built on Tangle which will allow for scalability and FREE transactions - something which the mainstream will NEED.
I don’t want this to sound like an Ethereum bashing article - but I can imagine most people will feel that it is. I love Ethereum - I still do - but this scalability issue has been present for far too long which has made me start to open my eyes to other types of decentralized networks and I have realized that they are probably better (when compared to today’s blockchains).