How to Solve Blockchain Trilemma Issue for Layer 1 and Layer 2 blockchains?
In the earlier article, we saw the Blockchain Trilemma and a brief introduction of the factors on which this concept is based: decentralization, security, and scalability. In today’s article, we will discuss various ways to solve the Blockchain Trilemma for layer 1 and layer 2 blockchains.
Before we start, let’s revise the concept of the Blockchain Trilemma.
The #Blockchain Trilemma is the widely held opinion that #decentralized networks can only provide two of the three benefits of decentralization, #security, and #scalability at any given time. In this article, we talk about how hard it is to provide all three things simultaneously. There are various ways to solve the blockchain trilemma for layer 1 and 2 blockchains.
The factors considered in Trilemma are as follows:
Blockchains are frequently compelled to make compromises that prohibit them from accomplishing all three objectives:
Decentralization: The development of a blockchain system that does not rely on a single point of control.
Secure: The blockchain system can work as planned while defending itself against assaults, flaws, and other unforeseen concerns.
Scalability: The ability of a blockchain system to accommodate an increasing volume of transactions.
So, how can we solve the Blockchain Trilemma and get decentralization, security, and scalability simultaneously? Layer-1 solutions and Layer-2 solutions are the answer.
How to Solve the Blockchain Trilemma:
Layer 1 consists of blockchains like Bitcoin and Ethereum that use blockchain in the decentralized ecosystem. There are several ways being worked on or used right now to improve blockchain networks’ scalability directly.
- Improvements to the #Consensus Protocol: Proof of Work is the current consensus protocol on popular blockchain networks like Bitcoin. PoW is safe, but it can be slow in processing. Bitcoin, on the other hand, only gets seven TPS. This is why Proof-of-Stake (PoS) is favored by many blockchain networks, most notably Ethereum’s upgrade to Ethereum 2.0. Instead of requiring miners to use much computing power to solve cryptographic algorithms, the PoS consensus protocol decides who is a validator based on how much they have invested in the network. This feature is expected to dramatically and fundamentally increase the Ethereum network’s capacity while also making it more decentralized and making sure it is safe.
Sharding: Based on distributed databases, sharding is one of the most adopted Layer-1 scaling solutions, even though it is still an experiment in the blockchain world. Sharding divides transactions into smaller groups of information called “shards.” The network works on these shards simultaneously so that work can be done in order on many transactions simultaneously. Also, each node in the network wouldn’t have to keep a copy of every block from the beginning to the present. Instead, this information could be split up and held by different nodes, but each would still be accurate.
Jumbochain has adopted Dynamic Sharding and patented as Jumbo Sharding Protocol
Shards send proofs to the mainchain and use cross-shard communication protocols to talk to each other and share addresses, balances, and general states. Ethereum 2.0 is a well-known blockchain protocol that adopted sharding to solve #scalability.
How to Solve the Blockchain Trilemma in Layer 2:
Layer 2 in the blockchain is a network or technology that works on top of a blockchain protocol to make it more scalable and efficient. Bitcoin, for example, is a Layer-1 protocol, and the Layer-2 solution is the Lightning Network that was made to speed up transactions on the Bitcoin network. Layer-2 protocols have grown significantly in the past few years, and they could be the best way for PoW networks to deal with scaling problems.
- Nested Blockchains: A nested blockchain is a decentralized infrastructure in which a main blockchain is used to set parameters for the whole #network. At the same time, executions are done on a web of secondary chains that are all connected. Several layers of blockchain are built on top of this main chain using a “parent-child” link.
The parent chain gives work to the child chains, which do it and send it back to the parent when it’s done. The base blockchain doesn’t participate in network functions unless a dispute is settled. The OMG Plasma project is an excellent example of a Layer-2 nested blockchain used on top of Ethereum to make transactions faster and cheaper. With this model, work is spread out so that the mainchain doesn’t have to do as much processing. This feature makes scaling exponentially better.
- State Channels: A state channel makes it possible for a blockchain and transactional channels not on the blockchain to talk to each other in both directions. It does this by using different ways to improve the speed and capacity of transactions.
A state channel doesn’t need the miner to verify the transaction immediately. Instead, it is a resource close to the network that is locked down with a multi-signature or smart contract. When a transaction or group of transactions is finished on a state channel, the final “state” of the “channel” and all its changes are written to the blockchain underneath.
- Sidechains: A sidechain is a transactional chain next to the blockchain used for big transactions. Sidechains use a different consensus mechanism than the main chain, which can be made faster and handle more users. Utility tokens often move data between the sidechain and the mainchain. The mainchain’s job is to keep everyone safe and settle disagreements.
Sidechains are different from state channels in several significant ways. First, sidechain transactions are not private; they are recorded on the ledger and can be seen by anyone. Also, security holes in a sidechain don’t affect the mainchain or any other sidechains. Setting up a sidechain takes a lot of work because infrastructure has to be built from scratch.
How to get out of the Blockchain Trilemma
Even though the Blockchain Trilemma makes it hard to use blockchain technology, new solutions can solve the problem. The goal is to find a good balance between security, decentralization, and being able to add more users. Even though the CAP theorem has been confirmed for almost 40 years, the implementation of Layer-1 and Layer-2 solutions and the rise of Proof-of-Stake systems are shifting the paradigm toward decentralized blockchain networks that are both secure and scalable.
About the Author:
JumboBlockchain is the layer 1 blockchain protocol with three patents applied.
Follow us at
Linktree: https://linktr.ee/Jumbochain
