The Bitcoin Industry, Crypto Markets and Blockchain Asset Space are Far From Dead [Proof Inside]
For an entire year, cryptocurrencies have been losing value, and the two market crashes in 2018 have scared even the most optimistic investors. Many are now wondering if crypto is a sinking ship, and whether or not they should stick around. However, while the bear market has brought a lot of damage to the crypto world, it also allowed some serious, hype-free projects to come to light.
While there are numerous projects, trying to deal with many issues surrounding cryptocurrencies, solving the problem of scaling appears to have priority. Keeping coins like Bitcoin or Ethereum decentralized, but making them more scalable and secure at the same time, has been a challenge for a long time. Solving this issue would also take care of a number of other problems as well, such as high costs, the creation of other great products, speeding up the payment process, and improving the user experience.
Bitcoin And Ethereum Scaling Solutions
While there is a lot of effort to resolve these problems, there was also conflict regarding the best method of going about it. In case of Bitcoin, Some, like the supporters of Bitcoin Cash, wanted that the solution to be on-chain (Layer One). Others, such as Bitcoin Core developers, believe that off-chain (Layer Two) solution is the best one.
The on-chain solution would include increasing the block size, which also led to conflict between Bitcoin Cash's own supporters. On the other hand, the Layer Two solution includes the Lightning Network (LN), which has seen more progress and acceptance.
In Ethereum's case, the community took a different approach. Part of the solution was to move on to PoS consensus, in addition to developing ETH's own Layer One/Layer Two solutions. The Layer One solution focuses on sharding, that splits the blockchain into numerous different portions. That way, each node would have to do a lesser amount of processing.
The Layer Two solution includes the Lignthing-like state channels, as well as the “child chain” model. While the solutions may sound simple, they are actually extremely complex. Because of that, they have taken quite a lot of time and effort, but the progress is already noticeable.
Younger Projects Offering Modern Solutions
While Bitcoin and Ethereum are both struggling to bring positive change to their networks and processes, there are numerous new projects out there that are starting from scratch. As such, they are aware of the scaling issues, but also of modern solutions that were created to combat them.
One such project is Nexus Earth, which uses a multi-layered consensus process called Tritium, which allows it to endure over 200,000 data requests per second. As for the number of transactions, it can work through as many as 4,000. In comparison, Bitcoin can only deal with 7 transactions per second, while Ethereum can work with 15.
However, while Nexus' solution sounds very promising, it is nowhere near as good as that created by the project Algorand. Algorand validates blocks by using a randomly selected committee system, and not only does it save computing power, but it also has over 3 million TPS.
Another advanced project is Devvio, which has filed numerous patents for their new protocol, which includes aspects of numerous solutions and concepts of the crypto world. However, Devvio claims that it can achieve as much as 8 million TPS, putting even Algorand in the second spot. These projects, while extremely advanced, did not attract that much attention, partially because they did not go through ICO to get their funding.
ICO Projects Hard At Work
Of course, there are also projects that did have ICOs that are also working hard on finding their own solutions. Projects like EOS and Cardano are well known, and while they have their own issues, they are advancing in solving scalability their own way.
The same can be said for projects that are attempting to reach solutions through cross-asset interoperability, such as Polkadot. The drop in prices was originally expected to negatively affect these ICO projects, but they have managed to endure thanks to proper resource managing.
While it is impossible to predict which solution will end up being the go-to option for future coins, one of them will likely dominate over others. When that happens, and the scalability issues become a thing of the past, cryptos will finally be able to move forward.