Blockchain being the change agent technology in software development has acquired recognition from industries all over the world.
Blockchain technology has some benefits to explore e.g., transparency, data auditing, assets tokenization, immutability, autonomy and most of them all decentralisation.
In this article, we will look into blockchain scalability problems and layer 2 solutions.
You may want to ask, what is blockchain scalability? Let’s put it properly here.
What is Blockchain Scalability?
It simply means the ability of a computer system to handle simultaneously some amount of work or request. E.g., (search engines or database).
A blockchain does not scale very well with large amounts of data.
Blockchain lacks the sufficient capacity to alter the system, so it could cope with increasing workload and data resources e.g., computing power, bandwidth, or servers.
In the context of blockchain, Scalability has various implications.
The Scalability Problem
The inability of the blockchain to scale is hindering the results of optimal solution industries and enterprises.
It has been found that scalability is a barrier to the establishment of Public Blockchain in real-life commercial markets.
Scalability begins having problems when blockchain accepts more increased nodes and transactions.
Many sorts of solutions have been proffered currently, developed to address the problem of scalability in blockchain technology. Among them is the Layer 2 solution.
Layer 2 Solution
The success of layer 1 or on-chain scaling methods relies on the changes to the main blockchain network.
Layer 2 are off-chain scaling options.
Layer 2 is an additional protocol built on the top of the primary Blockchain, and secondary protocols would be to offset transactions from the primary Blockchain.
Layer 2 came with an important role to cure network congestion and space challenges.
Off-side chains and state channels are examples of Layer 2 solutions.
- Sidechain
On how to solve scalability issues in blockchain, Sidechain is among the best options in solving this challenge. Sidechain offers a transactional chain second to the blockchain in big batch operations. Sidechain uses a distinct consensus technique in comparison to Primary Chain.
- State Channels
State Channels is a direct inclusion to layer 2 solutions for blockchain scalability.
State Channels allow for two-way communication among off-chain transaction Channels and blockchain networks in various approaches.
It has significant ability to boost capacity and transaction speed. It also does not need the immediate participation of miners for state channels to validate transactions.
Scalable Consensus Mechanism
Scalable Consensus techniques should lead us to the question of how to solve the problem of scalability in blockchain.
The need to streamline and reach consensus, several consensus techniques were made available.
Scalable Consensus algorithm provides more seamless transaction and throughput for scalability.
One of the important significant examples of scalable Consensus processes is delegated proof of stake.
Delegated Proof-of-Stake
This is a consensus technique analogous to the democratic process or way of ruling a country.
Future of Layer 2 solution
The force behind layer 2 operation shows that it is not relegating soon.
As Blockchain technologies continue to grow and evolve, the demand for scalability, speed, and affordability pushes the cover for innovation.
Layer 2 is likely going to be the pioneer in propelling mass adoption, ensuring that Blockchain handles more users without compromising its performance.
Conclusion
The Scalability challenge in Blockchain technology is still a barrier to its widespread adoption, especially in commercial applications.
Sidechain and State channels as layer 2, offers more reliable means to address network congestion and scaling problems by offsetting transactions from primary Blockchain.
The future of Blockchain Scalability looks great with Layer 2 solutions at the forefront, driving innovation shaping the performances of blockchain networks in supporting growing users and applications.
