In the world of blockchain and emerging technology, the word scalability is often tossed around by industry experts as a way to establish progress within the community. It’s a word that embodies adaptation, evolution, and, perhaps most importantly, expansion. But what does the word “scalability” really mean?
Merriam-Webster defines “scalable” as “capable of being easily expanded or upgraded on demand,” and that’s certainly one aspect to it. However, to many emerging blockchain projects, the presence of scalability means so much more than innovative and wide-reaching service offerings — it’s a process that has informed the past, present, and future of the industry. Below, we’d like to discuss how scalability has changed over the years, as well as how today’s challenges will inform tomorrow’s achievements. Take a look.
You’ve likely heard the statistic before: While bitcoin processes only 4.6 transactions per second, Visa processes roughly 1,700. With one swipe of a credit card, modern users can purchase goods from just about anywhere in the world — from street vendors to international retailers. Bitcoin users, by contrast, aren’t so lucky. If a vendor accepts even bitcoin payments, which is already a tall order, the time it would take to process each transaction could take anywhere from minutes to hours. By the time said transaction takes place, it’s more than likely that the exchange rate will have shifted dramatically — leaving many in the dark as to how much they actually owe.
As mainstream users continue to flock to up-and-coming blockchain projects, the need to build an infrastructure capable of servicing them will continue to grow stronger. Unfortunately, with slow transaction times, the greater blockchain industry continues to face scalability issues that are impeding actualization. How can projects market themselves as an efficient alternative to traditional processes when they really aren’t that efficient? This has been the mentality of the past and, at least to some degree, the present. Thankfully, due to technological breakthroughs from some of the best and brightest minds in the industry, scalability challenges will not inform our future.
If there’s one thing that the blockchain community has demonstrated time and again, it must surely be ingenuity. Faced with the seemingly intractable problem of scale, innovators of every stripe and persuasion have devised solutions. Some have invented new blockchains built for throughput, while others have opted to append new structures to older chains. To take the most prominent example, the Bitcoin network is the first and oldest blockchain. As such, its transaction speed and clearance times lag behind those of more recent distributed ledgers. In recent years, “Layer 2” solutions built on top of the Bitcoin chain have offered increased speed. The Lightning Network, perhaps the most popular second layer implementation, shunts some transactions to “sidechains,” batches them together, and then resolves several transactions at a time on the main Bitcoin chain.
Although sidechains and second layers offer hope for greater scalability and faster speeds, scalability has not yet been solved. The Lightning Network, despite its many virtues, suffers from security liabilities that do not exist on the main Bitcoin chain. Researchers have suggested that security, speed, and scale cannot coexist: One must be compromised to permit the other two. This may be the case, but this dismal news has not been confirmed. More research remains to be done and much code remains to be written, but if there’s any community capable of solving the daunting problem of scale, it’s the blockchain community. The future grows brighter every day.