The Master Workshop: Layer I is full, over 20 of the world's leading blockchain experts will present and lead discussions on solutions to the problem of scalability of technology. Do not forget to register today for free!
The most urgent obstacle to Blockchain's move to mass adoption is its scalability, or its current absence. For the blockchain to be really useful, it must address the population on a large scale and be a fast and functional alternative to traditional transfers. Thus, if you consider that Bitcoin averages about 7 transactions per second (in tps) for 2000 or 200 for PayPal, the potential for improvement needed is clear.
Many different groups are now working to find a solution. These fall into two schools of thought. Some believe that transactions should, as far as possible, take place in a chain, and still others consider Layer II solutions as the only viable way to reduce blockages.
Keep it on the chain
Keeping chain transactions has obvious and important benefits. What I mean in general is that the entire blockchain is periodically modified to reflect all the transactions, each of which is recorded in finite blocks on each node of the network. Each transaction is ratified by a defined number of participants in the chain and then recorded on a block that is scattered across all nodes – total immutability.
Some view Layer I solutions as the only way to stick to Blockchain's "true" principles of total transparency and intrinsic security. Others, however, regard this transparency as problematic in and of themselves and argue that total security can be achieved outside the chain. Chain transfers also take a long time to process considering the different steps necessary to achieve them.
Using off-line solutions
Layer II solutions greatly contribute to solving the fundamental problems of the blockchain. In the end, the idea is that not all small transactions need to be in the chain, but the chain can be updated regularly to reflect balances. Removing transactions from the main blockchain eases stress.
"Why would you need the mediator if you really agree with each other?"
In this case, the blockchain acts as a mediator. In reality, it is not necessary to use it unless two parties disagree. Arthur Gervais, an assistant professor at Imperial College London and co-founder of Liquidity.Network's off-line solution explained the thinking behind off-line solutions to Inverse. "Why would you need the mediator if you really agree with each other?" He said.
"It's very similar to a handbag," he continues. "Do you have an entire bank account there? No, you do not do it. A fraction of your wealth that you own and have in your purse is used for everyday transactions. You do not make a bank transfer every time you pay for coffee. "
Off-line solutions can speed up the blockchain, move heavy transactions away from the backbone, and reduce transaction costs by extension. At the present time, it is not clear if it is possible to scale a chain of blocks without using some form of off-line solution. In fact, it is unclear if this will be possible without a combination of several different off-line solutions working together for the main chain to continue spinning.
A compromise is necessary
Both have their positives and their disadvantages. However, more and more, those who work on scalability recognize that a combination of both is probably the only way forward for the blockchain.
"Without Layer II scale solutions, there are only a lot of things you can do in a chain, basically. Without Layer I solutions, the number of channels you can open and close in a chain is limited. "
Binary District Journal has been talking to Mustafa Al-Bassam, Ph.D. researcher in computer security at UCL and co-founder of the Chainspace blockchain platform. For Mustafa, there is no realistic future for the blockchain that does not include Layer I and Layer II solutions. "I think basically you need both. You need both layers I and II. Without Layer II scale solutions, you can not basically adapt the chain to the chain. Without Layer I solutions, the number of channels you can open and close in a chain is limited. "
It is important not to worry about the complexity of the combination of Layer I and Layer II solutions. It is also essential that the solutions are not discarded because they are initially complex in their complexity.
"In the development of the blockchain, there can be many complexities and challenges to overcome," says Mustafa. "For example, proof of participation can be much more complex than proof of work, or sharding is fundamentally more complex than not doing it. I think people often confuse this with something bad – just because something is complicated, so it must be wrong. I do not think that's necessarily the case. "
One of the key arguments of Layer II solutions is that not all transactions need to be logged so that all can be seen on the backbone. There are confidentiality issues – not everyone wants their financial history spread over a large network – and some speed issues can not be justified.
"All of the current Layer II solutions require the customer to constantly monitor the blockchain in order to make sure it's not deceived."
Lefteris Kokoris Kogias, expert in cryptocurrency and doctoral researcher at EPFL, echoes Mustafa's position. "Layer I and Layer II solutions are both needed," he says. "It may be an exaggeration to have to advertise globally that you spend $ 5 at Starbucks, but even though most transactions are done in Layer II, we still need a Layer I with good litigation capacity." .
"The advantage of chain solutions is that they are much more difficult to break. For example, all current Layer II solutions require the customer to look at the blockchain permanently to make sure it is not misleading. "
A focus on the UX could be the key
We also met Sarah Azouvi, PhD researcher at UCL. For Sarah, the combination of Layer I and Layer II solutions is only possible if a functional UX can be developed to make it easier. "Layer I and Layer II solutions are both interesting research leads to solve the problem of scalability of blockchains," says Sarah. "I see that Layer I solves the problem because there are many issues inherent to Layer II solutions, such as key management, routing, or multiplayer channels.
"With Layer I solutions, scalability is resolved in the protocol, which does not impose any additional burden on users."
"In Layer II solutions," complexity "is sometimes transferred to the user side (for example, some proposed solutions involve heavy key management for the user). This is quite embarrassing, because blockchains already have some UX problems, Layer II solutions amplify this problem. With Layer I solutions, the scalability is resolved in the protocol, there is no extra burden for the users (of course, it always depends on how the solution is implemented). "
Some believe that Layer I solutions are the only way to achieve a truly democratic blockchain, in which all transactions are visible and duly ratified by an appropriate number of agents. In theory, they also remove the need for third parties that are sometimes used in off-line solutions. We talked to Sarah, who thinks it's a lot more complex than that.
"Collaboration has always been one of Blockchain's most powerful assets, and to move forward, even slightly opposite ideologies will have to combine."
"It's hard to define what you mean by a" truly democratic channel chain, "she says, but I do not think the Layer 1 solution will solve all of this, because you would still need a mechanism resistant to Sybil (as proof work or impact proof) to ensure security, thus avoiding a person a voting chain. The solution to block a voice by one person is elsewhere. "
In the end, there seems to be a consensus among the majority of the community that the use of Layer I and Layer II solutions is obvious. The exact combination we find among the myriad of solutions under development is to guess, but the use of both offers the security and speed that will help the blockchain to adapt effectively. Collaboration has always been one of the most powerful assets of the blockchain and, in the future, even slightly opposing ideologies will have to be combined.
Workshop on the scalability of Blockchain in Amsterdam
The event "Master Workshop: Layer I Solutions", in Amsterdam on 17 and 18 November, will bring together those working on all aspects of Layer I scalability. From the DAG-based cryptocurrency framework to creating secure and scalable decentralized workbooks via sharding, the workshop will provide a space for sharing ideas and comparing solutions from experts to experts.
Sarah, Mustafa and Lefteris will be appearing alongside more than 15 renowned experts, including Philipp Jovanovic, Christopher Carr and Ewa Syta, among others.