Solving the Problem of Blockchain Congestion

Quick question: what do you think the biggest problem with the blockchain is right now?

Well, for web3 natives, the answer to that question is simple; network congestion. While there are many arguments about technical handicaps in other aspects of the blockchain, developers know that network congestion is what will either allow crypto to reach its potential in the next decade or, delay it for the next two decades - give or take. I addressed the scalability of crypto here.

Even without the ‘burden’ of dApps and smart contracts, blockchains inherently have congestion issues. The bigger and more complex a blockchain gets, the slower it processes information. This leads to delayed transaction times, and awful congestion on the network.

Every chain has a limited number of transactions that it can carry out per second. No matter how large that limit is, it is always in danger of being exceeded since chains can grow in perpetuity.

Network congestion is what happens when the number of transactions to be carried out on the chain is larger than its limit.

Most chains — including Cardano, Ethereum, and even Polygon, have reached this point in their lifespan. When this point is reached in a blockchain's lifespan, a few things start to happen.

1. Gas fees get even steeper since there is a high demand for miners.

2. dApps built on the chain begin to suffer. Since transaction times will be delayed, dApp users may need to find other Web2 alternatives.

dApp Developers And The Bane Of Network Congestion

In a world where speed is currency, a slow solution to anything might as well be no solution at all. If a dApp cannot be accessed instantly by its users, many of them will find solutions elsewhere.

This means that dApp developers are being incentivized to find the fastest chain they can build their dApps on. However, even this solution is a bit like kicking the can down the road. It doesn't matter what chain a dApp is built on, in the fullness of time it will get congested. And when that happens, the dApp is at ground zero again.

For many, this is the unsolvable problem of blockchains. Since most people cannot build their chains and would need to build on that of others, it's easy to see how this problem is presumably unsolvable.

But here's the thing; it is solvable, and a lot of work has been put into solving it. The most ambitious solution to the problem of blockchain congestion is the construction of a custom blockchain for the dApp alone.

Unfortunately, this is a path that many developers cannot afford to take. Building a dApp alone is difficult, but building an entire blockchain from scratch just to host a dApp is not just difficult, it's herculean.

Thankfully, there are now partners who can help dApp developers build these custom blockchains quickly, cheaply, and safely.

App Chains

App chains are blockchains that are created for just one app. I like to call them single-tenant blockchains because they are built to just host one app.

The chain itself isn't a whole brand new blockchain. Instead, it's a sidechain that can be tacked onto networks like Polygon, BNB chain, and Avalanche. Despite being a side chain, app chains don't have to be bound by the consensus mechanism or programming language of their parent chains.

Notably, these chains don't have to be slowed down by the transactions from other dApps. This means that dApps can have lightning transaction speeds without getting worried about an eventual slowdown. As long as the chain continues to serve only one dApp, the chances of it slowing down are next to none — even if dApp eventually processes millions of transactions every day.

Despite app chains being a technically sound solution to the blockchain congestion problem, it's not a solution that many developers are utilizing. The reason is simple; there are very few partners that can provide you with all the tools to make building the chain a productive venture.

If there are no technical partners with the expertise, it's easy to see why developers and founders are simply making their peace with the inevitability of network congestion. Since it's a problem that all dApps deal with, there's no incentive to risk doing something different.

And there is a certain allure to that kind of thinking. After all, chains like Ethereum are putting an insane level of effort to reduce network congestion. If those efforts pan out well, maybe developers and founders won't have to worry about congestion times anymore. But by doing that, they would essentially be hitching the success of their project to that of another one. Doing that can be risky.

The good news is that there are many technical partners now looking to solve the problem of developing app chains quickly, cheaply, and efficiently. While many bright lights are trying it out, Ankr's solution looks to be the most comprehensive.