Toppie Lessons №6&№7: What is Scaling Problem of Blockchain? Any solution for it?
What is scalability?
The most commonly discussed scaling challenge for blockchains is increasing transaction throughput, or the number of transactions that can be executed on a blockchain. In the case of public blockchains, this has most often been thought of as a base-layer or “layer 1” issue.
Block Size
Another important bitcoin scalability problem is block size. Initially, the capacity of every block in the Bitcoin blockchain was 1 Mb, and every block could contain around 2,020 transactions. However, the number of transactions has increased in the network, causing another blockchain scalability problem: the time-consuming process of transaction execution.
Response Time
In the network, every transaction must go through a validation process. In terms of the number of transactions standing in the queue, they usually have to wait a long time for their validation. For instance, in the BTC network, it takes around 10 minutes to build a new block. The more transactions standing in the queue, the more time it takes for their processing. This increases during peak times.
High Fees
As the popularity of cryptocurrency grows day by day, the process of confirming transactions becomes more complicated, because mining demands higher computational power. Every payment demands transaction fees. If you want your payment to be verified more quickly, you can pay a higher fee for it. As the network is expanding, a lot of new users want their transactions to be processed. That’s why a lot of unprocessed transactions stand in the queue waiting for their validation.
A payment is considered to be validated if it’s added to a block in the chain. For this, miners create new blocks and insert the data into them. When one participant sends cryptocurrency to another, the information about the new payment is sent to the node, creating a new block and adding data to it. After this, the payment is considered to be processed, and the recipient receives money from the sender.
· Hard Forks
· Sharding
· Side chain
· Lighting Network
Hard Fork
A hard fork is a split in the chain. The protocol is changed completely, making previously invalid transactions valid. To implement this option, all users should download the latest version of the protocol. After this point, there isn’t any connection between the two chains. The new version contains the entire history of previous transactions, but from the moment of the split, it has its own history which differs from the other chain.
Sharding
Sharding is actually much older than blockchain technology and has been implemented in a variety of systems from business database optimizations. Sharding helps to alleviate these issues by providing an interesting, yet complex solution. The concept involves grouping subsets of nodes into shards which in turn process transactions specific to that shard. It allows the system to process many transactions in parallel, thus significantly increasing throughput.
A simpler way to put it would to be imagining the division of the United States into states. While each state (a shard in this case) is part of the larger United States (Ethereum network), they have their own specific rules, boundaries, and subsets of populations. However, they do share a universal language and culture as part of their larger network that makes up the country.
Side Chains
The idea of the side chain is you can innovate and design your solution freely in the side chain. These side chain are independent, if they are failed or hacked, they won’t damage other chains. So damage will be limited within that chain, for that reason you can be less conservative.
There are promising works in side chain like there can be transactions at higher speed and volume. For example micropayments can be done directly with minimal fee by using side chain. You won’t have to wait for 10 minutes for miners to create a block.
Lightning Network
When it comes to Bitcoin scalability solutions, we should definitely mention the Lightning Network. To understand better what it is, you can imagine how two participants of the network send money to each other several times, verifying transactions without recording them on the root blockchain. This is the main idea of this innovative technology.
It allows confirming transactions without recording them in the main ledger. You’ll probably agree that it’s a very comfortable way to send and receive coins without littering the network. For this, the Lightning Network was invented.
This is a network that allows adding another layer to the blockchain and providing its participants with the opportunity to build payment channels between two different parties. This makes transactions instant, and they can boast very low fees, or even be processed without cost.
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Actually the current industry of Blockchain needs a high-performance public blockchain platform designed to handle real-world business of any size or volume, which works as a integrated solution for the scaling problem. Blockchain itself is not the ultimate propose, rather a infrastructure for the dApps and real-world business. Therefore the scaling problem is not solely a challenge for the public chains and also for the whole industry. With the technical development of TOP Network, will TOP Network be the ultimate solution?
You can find TOP Network on:
Email Contact: contact@topnetwork.org
Official Website: http://www.topnetwork.org
Telegram: https://t.me/topnetwork_top
Twitter: https://twitter.com/topnetwork_top
Medium: https://medium.com/@topnetwork
Steemit: https://steemit.com/@topnetwork-top
Reddit: https://www.reddit.com/user/topnetwork_top
About TOP Network
TOP Network is a decentralized open communication network that provides cloud communication services on the blockchain. TOP offers secure, low-cost services such as messaging, calling, video, VPN, CDN, IoT data sharing and more.
TOP Network is also a high-performance public blockchain platform designed to handle real-world business of any size or volume. Powered by innovations including three-layer network, two-layer sharding, two-layer lattice DAG and PBFT-DPoS*, TOP can process several hundred thousand transactions per second on the blockchain.
The long-term mission of TOP Network is to build a public blockchain infrastructure for all Dapps. Our world-class team of over 100 developers is striving for this goal.
TOP Network originated from the common underlying network layer of Dingtone, CoverMe and SkyVPN, three communication apps built by the TOP team before the blockchain project. These apps, having attracted over 50 million users in total, will be ported to TOP Network upon the launch of TOP and generate huge volumes of transactions in the TOP ecosystem.
TOP Network was founded by serial entrepreneur Steve Wei and his colleagues in late 2017. Steve was one of the earliest employees of WebEx in the 1990s. After WebEx, he founded a successful video conferencing software company which was acquired by Huawei in 2010. In 2012, Steve co-founded Dingtone, a public listed company operating popular communication apps such as Dingtone, CoverMe and SkyVPN.
TOP Network has closed $11 million early investments from prestigious institutional investors and individual billionaire investors, including DHVC, Fenbushi Capital, NEO Global Capital (NGC), Ontology Global Capital (OGC), LD Capital and more.
