The proliferation of blockchain investments in 2018 led experts and business leaders to believe that 2019 would go down as the year of enterprise blockchain solutions. With the benefit of hindsight, and the many blockchain experimentation failures that littered the business landscape in 2019, it is, however, clear that experts needed to reevaluate their understanding of the technology. Enterprises and startups are coming to terms with the current status of blockchain technology, and they are doing away with overblown expectations that triggered impractical applications. We have also witnessed the emergence of specialized solutions that look to target the current frailties of the blockchain framework and usher in an era of decentralized applications appropriate for large scale user networks.

In all of these recurring narratives, interoperability and scalability have stood out as issues that might single-handedly define the successes or failures of blockchain technology in the coming year. It is no more news that enterprises are skeptical of the effectiveness of decentralized ledger technology in applications targeted at a large demographic. This notion stems from the lingering time lags recorded in blockchain-based applications relying on inflexible consensus mechanisms. Also, the siloed framework of existing blockchains deters the communication and interoperability of blockchain resources. As such, the narrative that promised an era where closely-related services and applications would coexist in a budding ecosystem is merely wishful thinking without substantial progress in the establishment of blockchain interoperability.

Blockchain Experts Fixate on Scalability and Interoperability

Owing to this realization, blockchain firms had spent most of 2019 laying the groundwork for innovative protocols and solutions looking to resolve these limitations. Hence, these developments have spurred experts to project a surge in enterprise decentralized applications and the proliferation of resource-sharing innovations with little or no backdrop in transparency and security synonymous with blockchain technology.

In many of the interoperability and scalability infrastructures being developed, the goal is to deploy protocols that circumvent restrictions and introduce scalable pathways that enhance the transaction verification capabilities of existing blockchains. To do this, the majority of these solutions are basing their innovations on sidechain concepts, which run as extensions of established blockchains. With the deployment of sidechains, users can carry out transactions on secondary chains with less complex consensus mechanisms and improved transaction speeds without trading off security and transparency. Note that all of the activities recorded on these sidechains eventually lead back to the original blockchain where they are recorded and reconciled with the prevailing decentralized ledger.

One of the solutions that fit nicely into this category is Matic Network. This functional sidechain has already impressed with the array of improvements it brings to the blockchain space. At the moment, Matic Network is based on the Ethereum blockchain. It deploys a plasma-based sidechain that provides applications with the appropriate scaling infrastructure to ensure that there are no time lags as a result of congestion. Matic Network focuses on providing high levels of performance blockchain apps without foregoing security and decentralization that the Ethereum ecosystem avails. In essence, developers get to up the performance of their apps and still retain the decentralization and premium cryptography security that the Ethereum blockchain provides.

In its quest to leverage its burgeoning status in the Ethereum ecosystem to provide quality services, Matic Network has, therefore, opted to partner with Whitebit, a trading platform known for its simple user interface, execution speed, and low fees. This partnership will provide instant and affordable trading infrastructures to Matic’s growing base of token holders. Also, the network intends to improve blockchain interoperability by partnering with solutions fixating on this niche, and deploying its infrastructure on other Layer 1 blockchains which are struggling with scalability. 

Another scalability solution that has piqued the interest of blockchain experts is Bitcoin’s Lightning Network. Many blockchain developers are creating interoperable variations of this system. Like Matic Network for Ethereum, the Lightning Network function as a Bitcoin sidechain where users can escape the rigorous consensus mechanism of the parent blockchain that somewhat contributes to higher transaction fees and slow processing times. As a result of this functionality, a long list of development teams is keen on creating various lightning implementations.

Furthermore, Echo, a Bitcoin dapp, launched a sidechain in November that would improve Bitcoin’s versatility as an application blockchain. Unlike a majority of sidechains, Echo’s implementation would randomly pick transaction verification nodes and incorporate a trustless mechanism in what it termed the Proof of Weighted Randomness (PoWR).

Note the projects mentioned in this article are just a few of the numerous platforms tinkering with sidechain technologies and their use case as scalability and interoperability enhancement solutions. Also, other projects are focusing on cross-chain mechanisms, which improves inter-blockchain interactions.

Owing to the proliferation of scalability and interoperability projects and the perceived resurgence of blockchain’s mainstream appeal, it is expected that 2020 will set the prevailing theme for the next couple of years – as regards the prospects of blockchain technology.