Scalability is one of the most talked about terms in the crypto world today! Would the existing business model for cryptocurrencies sustain? What if the number of cryptocurrency investors and traders continues to grow? The major question is whether these major cryptocurrencies are able to sustain and thrive i.e. are they able to scale up to cater to the growing demands?
As the transaction fee increased for Bitcoin, people started questioning its ability to scale! In order to compete with payment gateways like PayPal and Visa, the cryptocurrencies need to work on reducing the transaction time. Once they found a few limitations in Bitcoin’s framework, crypto experts started working on finding ways to tackle scalability.
– Increasing block size
One of the most suggested solutions for dealing with scalability is increasing the block size. If the block size is increased, more number of transactions can fit into a block. Thus resulting in a larger batch of transactions being processed per second. In order to process more number of transactions, the computing capabilities of the nodes must be of higher standards. This can be achieved using supercomputers. The only disadvantage of increasing the block size is that it leads to centralization of nodes in the network. Centralization as a concept is of course against everything that cryptocurrencies stand for!
Cryptocurrencies facing scalability (Source)
– Altcoins
This solution eliminates the idea of performing all the transactions on just one blockchain. It considers that all the cryptocurrencies will have their own blockchain on which their transactions can easily be processed. As the user activity is reduced on blockchains, the issue of scalability is overcome.
The only aspect to be worried about is the security. Only thing to be worried in this solution is security. As fewer nodes are active, there is risk of being more susceptible to attacks.
With each passing day, a new solution comes up for dealing with scalability and very soon, the crypto world will eliminate it totally!
China to launch a national cryptocurrency