Vitalik Buterin, the founder of Ethereum, argued in a recentblog post that the scalability problem in blockchain was being tackled ‘great’ intheory amid a need for more real-world testing. Yet many industry figures didnot agree.
Bram Cohen, founder of BitTorrent, called Buterin’s opinions‘wrong-headed’, while Blockstream CEO Adam Back noted that the Ethereum founder’swords of wisdom were ‘like looking to [Theranos founder] Elizabeth Holmes forthe state of biotech.’
So what is being laid down here? Buterin took to the blogchannel to re-evaluate ‘hard’ problems in mathematics, computer science andeconomics five years after initial prognostications. With regard to scalability,Buterin praised the impact of database sharding ‘pending more real-worldevaluation.’
Sharding is a method of database partitioning whereby computational and storage workloads can be spread across a network so each node does not have to process the entire network’s load, but only that related to its ‘shard.’ Writing for this publication in 2017, as Buterin introduced the idea to a wider audience, Neeraj Murarka, CTO at Bluzelle, argued that ‘if properly executed, it [would] enable Ethereum to scale well past the size limits it is facing now.’
Buterin noted Zilliqa, a company which touts itself as the ‘nextgeneration, high throughput blockchain platform’, as a partial sharding solutionwhich has gone live. Industry watchers may recognise Zilliqa best from its rolein PepsiCo and Mindshare’s programmatic advertising trial earlierthis year. The test saw smart contracts deployed via Zilliqa’s blockchain,reconciling impressions from different data sources, along with payments, inalmost real-time.
Zilliqa can be placed as a company which is among advocatesfor the third wave of blockchain technologies. Naturally, many stakeholders claimsemantic success so buyer beware, yet movement is taking place to providegreater transaction speed and lower latency. Speaking to this publication inMay, Douglas Horn, architect at Telos, noted how at the time of writing Teloscould handle 12 million transactions across 24 hours. Ethereum, by contrast, isat nearer 1.3 million.
Depending on who you read, Buterin has in the past promised Ethereumcould hit 100,000 transactions per second (March)or a million (June2018). For now, Buterin noted that until fully sharded blockchains wereseen in live operation, a major hurdle remained.
“Further progress at this point is incremental,” he wrote. “Fundamentally,we already have a number of techniques that allow groups of validators to securelycome to consensus on much more data than an individual validator can process,as well as techniques [which] allow clients to indirectly verify the fullvalidity and availability of blocks even under 51% attack conditions.
“But the challenges that do remain are challenges thatcannot be solved by just thinking about them; only developing the system andseeing Ethereum 2.0 or some similar chain running live will suffice.”
Cohen disputed Buterin’s analysis by arguing that shardingwas not the only option available. “Of course it isn’t the only option,” hewrote. “Payment channel networks are much more appealing in many ways and arebecoming a real thing. This is a common take mostly because, to put it bluntly,a lot more people (think they) understand sharing than payment channels, andpeople like to think they’re smart so they advocate for solutions theyunderstand.”
Following this up, Cohen argued shardingpromised a ‘very small improvement’ in scaling in exchange for a ‘fundamentalweakening’ of the system’s security. A further claim that sharding in Ethereumwould ‘degenerate’ by minimising economies of scale – “only a few servers whichdownload everything and make all the blocks and everything else a partial node”– was rebuffedby Buterin.
The best-known payment channel network is the Lightning Network.The network adds an extra layer to Bitcoin’s blockchain which enables users tocreate payment channels between two parties across that layer. As a 101 primer fromCoinTelegraph puts it, it can be seen as similar to a speed-dial functionon a smartphone.
Yet there is a twist. In September, decentralisedadvertising platform AdEx Network posted triumphantly onHacker Noon about how it had built the largest payment channel network – onEthereum. The company noted it ‘quickly realised’ the need for such a solutionwith regards to digital advertising, and found more than nine millionimpressions had been recorded in two months.
Ultimately, there may be more than one way to skin a catwhen it comes to blockchain scalability, but more attention will certainly be investedin solving the problem in 2020. Gartner’s 2019 blockchain hype cycle cautionedthat blockchain will not become fully scalable technically and operationally ‘untilat least 2028.’
You can read Buterin’s full blog post here and Cohen’sfull criticism here.
Postscript: Cohen’s fourth tweet in the thread, and referenced in paragraph 11 of this piece, incorrectly references ‘the truth about payment channels’. Cohen noted afterwards that he meant to write ‘the truth about sharding’. The correction has been made for this piece.
