The Unfulfilled Promise of Blockchain and the Key to Unleashing Its Potential
Dr. Brendon (JiaPing) Wang is Founder of Asensys.
Solving the Blockchain Trilemma to Unlock Real Business Value.
Hailed as the revolutionary technology at the dawn of a new internet age, blockchain has been touted as the technology that will bring us the Web 3.0. This technology has lofty ambitions—pledging to change the way people and businesses operate online by delivering on the elusive trinity of boundless scalability, uncompromising security, and full decentralization.
But alas, the blockchain promise has thus far been unfulfilled.
The perfect balance of scalability, security and decentralization have failed to materialize concurrently. In fact, this “blockchain trilemma” has emerged as the greatest obstacle to blockchain’s growth and ultimate future. The trilemma describes the concept that either decentralization or security must be sacrificed to achieve performance and/or scalability. In short, blockchain has been restricted by its inability to scale for the masses.
In a traditional blockchain, performance is often hindered by the fact that every node stores the entire state and needs to process all the work necessary for each transaction or activity in that chain. The result is that every single node must duplicate the entire network every time a new block is added.
Legacy blockchains like Bitcoin and Ethereum are plagued by this exact issue, as their infrastructure creates redundancies across each node, which largely contributes to the latency of these networks.
Unfortunately, solutions based on sharding or reliance on root chain or beacons have not solved the issue either.
As a result, no blockchain technology architecture has emerged to solve this performance issue without compromising security or decentralization to date.
The race to solve this trilemma is synchronously a race to the top.
It is believed that the project that solves the trilemma will own the new (business) world order. Interest in blockchain has been growing in practically every trade industry. Leading enterprises and retailers such as IBM and Walmart are pioneering the use of blockchain in their respective industries, which continues to expand the blockchain ecosystem.
Developers - the core community to build, deploy, and scale blockchain apps (DApps) - have also emerged from diverse sectors, including finance, commerce, entertainment, government, and many others.
Legacy blockchains may allow developers to build complex applications but will not be able to support a constantly-expanding userbase.
The issue of scalability lingers and has actually already hindered DApp progress and adoption in some cases.
The time to upgrade Blockchain is now.
Critical infrastructure work is already being done to improve blockchain performance, but many would say that these ambitious roadmaps are too far out. Some even say that the time investment has already been too consequential. In a recent Bloomberg interview
, JPMorgan’s chair of global research, Joyce Chang, said “The most meaningful impact [of blockchain] will probably be three to five years away.” In that time, skepticism will continue to grow.
That’s why 2020 is a critical year for blockchain. While leading legacy blockchains are planning to release the next evolution of their blockchain products, other competitors are emerging in the field to disrupt the landscape and define new protocols.
Ongoing innovation will be achieved in specific sectors, as vertical-specific blockchains emerge to satisfy niche needs such as retail supply chain solutions.
And yet, until we can solve for scalability, we know that our current blockchain ecosystems are not built to support complex applications like games or social networks at scale, much less what we term as Web 3.0 with its potential billion-plus userbase.
We must approach blockchain with a new design philosophy.
The future of blockchain will lie in the hands of those who are trying to solve broader issues than cryptocurrency or application on an industry-specific level. We will need to solve for key challenges that exist today:
- Remove redundancy and repetition of work within a single node to improve performance
- Improve usability for developers and consumers
Both will require the innovation of pioneers who can approach blockchain with a whole new design philosophy. Some infrastructural elements are already in place, but traditional blockchain approaches such as sharding and reliance on root chain or beacons need to change.
In order to achieve high performance, we need to solve the trilemma on a protocol level. One architectural solution is to rely on consensus zones. With equal and independent zones, transactions can be processed in parallel and ledgers maintained in partitions.
That solution can allow for the scaling of memory, bandwidth, disk size, and CPU power in order to meet the needs of the modern digital economy - all without compromising security or decentralization.
The consensus happens independently within each zone with minimized communication, which partitions the workload of the entire network and ensures a moderate burden for each individual node as the network grows.
This architectural approach can solve the core issues hindering blockchain from reaching internet scale. Ultimately, it may hold the key to unleashing the potential of blockchain and embarking on a revolutionary path towards a new era of the internet.
Disclosure: My company, Asensys, introduces the concept of Asynchronous Consensus Zones to solve the Blockchain Trilemma.
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