![](https://coding-bootcamps.com/wp-content/uploads/2024/01/78-1.jpg)
Note
If you are new to the blockchain technology, taking our Introduction to Blockchain Technology self-paced course is highly recommended. Also, for a comprehensive coverage of blockchain development in Ethereum or mastering Solidity programming, taking our below self paced courses is highly recommended:
Recap
In our previous article (How to Scale up Ethereum Blockchain Applications), we covered how to scale up Ethereum blockchain applications.
In this article, we review different scaling solutions for Ethereum blockchain applications.
Ethereum scaling solutions
Ethereum scalability solution is one of most active topics in the Ethereum community. The following are a few areas of concern the community is trying to tackle:
- Transaction processing and block creation time with PoW—how fast can the miners process all transactions and create a new block through mining?
- Transaction finality – how soon can the decentralized network reach consensus that a transaction has happened and can’t be reverted? Currently it takes about six blocks in Bitcoin and 3-4 minutes in Ethereum for the network to consider a block is finalized in the main chain.
Solutions being implemented or proposed, fall into three categories: on-chain solution, off- chain solution, and consensus mechanism protocols. There are some obvious or theoretical ones, like increasing block size or slicing one blockchain into many independent altcoin chains. Due to the nature of peer to peer, a traditional horizontal scaling approach may not work.
Specific to the Ethereum network, some consideration was also given to stateful or stateless smart contracts contributing to scalability issues. We will go over high-level concepts of all those solutions, and then delve deeper into some of the promising ones.
One-to-One Live Blockchain Classes
Coding Bootcamps school offers One-to-One Live Blockchain Classes for Beginners.
Block size
This is similar to the vertical scaling approach. Some of the altcoins, like Bitcoin Cash, Ethereum Core, and so on, are implementing a larger block size to gain overall transaction performance. The theory behind this approach is that since PoW mining is the main bottleneck in the entire process, by increasing the block size we can have more transactions processed per mining. It may take a little bit longer to create a directed acyclic graph (DAG) for stash-based mining, but the average time to complete the mining may not get any worse, since most of the Ethereum clients cache the DAG anyway.
The following diagram illustrates how this technique works:
However, like vertical scaling, in general, this solution demands that network nodes have better computing capacity in order to process large sized blocks. This may lead to a scenario where a network is concentrated into a few rich hands and, thus, may ultimately compromise decentralization and security, the main tenets of the blockchain.
Altcoins
Another solution is not to have one gigantic blockchain, but to have many smaller blockchains and altcoins. This may eventually be the case, since many vertical industries are creating or plan to create industry-specific chains. This will reduce user activity on each individual blockchain and, thus, should allow for a more scalable ecosystem.
The following diagram illustrates how this technique works:
However, there are a few issues with this option. One is security concerns. It is a common belief that the network is more secure if more network nodes participate in the transaction processing in the blockchain. With wider distribution of altcoin chains, fewer nodes will operate on any given blockchain. This may make the blockchain less secure, since a smaller altcoin network may be more vulnerable to network attacks. Let us say, we have about 10,000 nodes on the larger network, it will require at least 5,001 nodes (or called 51%) to be compromised to launch an attack on the network. If we slice 10,000 nodes into 50 smaller chains, each chain comprises 200 nodes, and it only requires 101 nodes to take down any smaller chain, which is what we call a 1% attack problem.
Another issue is cross chain integration. Although there are some solutions for handling cross blockchain integration, the overall complexity of integrating smaller chains and altcoins will increase drastically.
On-chain solutions
On-chain solutions, sometimes also called layer 1 solutions, are to look for solutions to address scalability and performance issues at the base layer of the Ethereum blockchain network. One such solution is sharding. Sharding is not a new concept as traditional RDBMS and new big data platforms have been using sharding as a way to improve scalability and performance for many years.
With the Ethereum network, the purpose of sharding is to group the network nodes, the blockchain, and global states into different shards, and each shard will reach a consensus on the shard-wide transaction state among those nodes within the group. At the conceptual level, this may not be much different from Plasma, the layer 2 side-chain approach, but the technical difficulty, implications, and network efforts are quite different. We will go into detail about sharding in the Ethereum sharding and Casperarticle.
Another layer 1 or on-chain solution is the shift to a Proof-of-Stake(PoS) consensus mechanism, which is one of the most active research areas addressing scalability and performance issues in Ethereum. There are many debates in terms of advantages and disadvantages of a PoW-based consensus mechanism. It is quite effective in securing the blockchain in the decentralized network, but it is also a major bottleneck in the blockchain performance.
Off-chain solutions
Similar to the rationales for an on-chain solution, the Ethereum community is also actively looking for off-chain solutions, sometimes called layer 2 solutions. One is a side-chain solution with Plasma. Instead of putting all transactions in the main chain, Plasma allows anyone to create side chains and bond side chains into the global blockchain. This is similar to the lighting network solution in Bitcoin.
Another one is a state channel solution with Raiden, similar to payment channels in Bitcoin. The hypothesis behind this approach is that many interparty transactions only need to be validated by the parties involved, and there is no need to have all transactions to be validated by the entire network. We will discuss in detail how they work in the next article.
ZK-SNARK
One of the Bitcoin limitations is the privacy issue. Zcash is the first and perhaps the most popular cryptocurrency to implement Zero-Knowledge Succinct Non-Interactive Argument of Knowledge, or abbreviated as ZK–SNARKs, as a means of addressing privacy issues in the public blockchain.
It maintains strong privacy by allowing the transaction to be fully encrypted on the blockchain, and encrypted transactions can still be verified as valid with ZK-SNARK proofs. Under ZK-SNARK consensus rules, one, as the prover, can let others, as the verifiers, know that it possesses certain knowledge without revealing the specific knowledge, and without any interaction between them.
Ethereum community is incorporating ZK-SNARK into the Ethereum blockchain implementation too, with an intention to use ZK-SNARK to mass-validate transactions, thus improving the Ethereum scalability dramatically.
Next Article
In our next article (How to Manage Ethereum State Channel with Raiden), we discuss how to manage Ethereum state channel with Raiden.
This article is written in collaboration with Brian Wu who is a leading author of “Learn Ethereum: Build your own decentralized applications with Ethereum and smart contracts” book. He has written 7 books on blockchain development.
Resources
Free Webinars on Blockchain
Here is the list of our free webinars that are highly recommended:
- Hyperledger Fabric for system admin versus developers
- How to harness blockchain for environmental and corporate sustainability
- Review of Initial Coin Offering, Security Token Offering and asset tokenization use cases and best practices
- Hyperledger Fabric Deployment on Cloud
- Hyperledger Fabric for entrepreneurship- 21 blockchain business use cases
Free Courses
Here is the list of our 10 free self-paced courses that are highly recommended:
- IT Career Roadmap Explained
- Web Design with Bootstrap
- User Experience Best Practices
- Intro to Search Engine Optimization
- Web Design with WordPress
- Introduction to Drupal CMS
- Intro to Joomla CMS
- Intro to Cybersecurity
- Introduction to Cloud Technology
- Recorded Live Webinars and Classes
Self-Paced Blockchain Courses
If you like to learn more about Hyperledger Fabric, Hyperledger Sawtooth, Ethereum or Corda, taking the following self-paced classes is highly recommended:
- Intro to Blockchain Technology
- Blockchain Management in Hyperledger for System Admins
- Hyperledger Fabric for Developers
- Intro to Blockchain Cybersecurity
- Learn Solidity Programming by Examples
- Introduction to Ethereum Blockchain Development
- Learn Blockchain Dev with Corda R3
- Intro to Hyperledger Sawtooth for System Admins
Live Blockchain Courses
If you want to master Hyperledger Fabric, Ethereum or Corda, taking the following live classes is highly recommended:
- Live and self-paced blockchain development with Ethereum
- Live and self-paced blockchain development with Hyperledger Fabric
- Live and self-paced blockchain development with Corda
- Immersive Blockchain Bootcamp with live and self-paced courses
- Live crash course for learning Ethereum with Solidity
- Live crash course for building DApps with Hyperledger Fabric
- Live crash course for building DApps with Corda
- Live full-stack blockchain development in Hyperledger and Ethereum
Articles and Tutorials on Blockchain Technology
If you like to learn more about blockchain technology and how it works, reading the following articles is highly recommended:
- History and Evolution of Blockchain Technology from Bitcoin
- Overview of Blockchain evolution and phases from Ethereum to Hyperledger
- Comprehensive overview and analysis of blockchain use cases in many industries
- Blockchain Crowdfunding Security Token or Initial Coin Offerings
- A beginner Guide to Blockchain Technology
- How Decentralized Peer-To-Peer Network Works
- How blocks are added to the blockchain
- How Public and Private Keys of Cryptography Work
- What Is A Cryptographic Hash Function
- How Digital Signature Works In Blockchain
- The role and types of consensus mechanism in blockchain
- How Proof-of-Work Consensus Works in Blockchain
- How Proof of Stake Consensus works in Blockchain
Articles and Tutorials on Ethereum and Solidity
If you like to learn more about blockchain development in Ethereum with Solidity, reading the following articles and tutorials is highly recommended:
- Review of Architecture and Components of Ethereum
- Comprehensive Blockchain Ethereum Developer Guide from Beginner to Advance Level
- How to Write Ethereum Smart Contracts with Solidity in 1 hour
- Review of Architecture and Components of Ethereum
- How Ethereum Manages Accounts
- How Ethereum Manages Transactions
- How Smart Contracts Work in Ethereum
- How Ether and Gas Work in Ethereum
- How Ethereum Virtual Machine works
- How address and wallet work in Ethereum
- How mining works in Ethereum
- List of Tools and Technologies in Ethereum Ecosystem
- Review of challenges in distributed systems
- Review of Cap Theorem in Distributed Systems
- Horizontal Scaling versus Vertical Scaling in Distributed Systems
- How to Scale up Ethereum Blockchain Applications
- Review of scaling solutions for Ethereum
- How to Manage Ethereum State Channel with Raiden
- How Plasma Chains Work in Ethereum
- How Sharding and Gasper work in Ethereum
- How Proof-of-Stack Consensus Works in Ethereum
- A roadmap for Implementing Ethereum 2.0
- How to work with Decentralized Data and Content Storage in Ethereum
- How Decentralized Messaging with Whisper Works in Ethereum
- Review of Infura for Ethereum Development
- Review of Infura Ethereum API
- How to Use Remix with Infura for Ethereum Development
- How Ethereum Client API Works
- How Ethereum IPFS Storage Works
- How to Install and Start Ethereum IPFS Storage
- How to Run Ethereum IPFS Storage
- How to Work with Ethereum Swarm Storage
- How to Install Ethereum Swarm Storage
- How to Handle Ethereum Messages with Whisper
- Review of Popular Ethereum Smart Contract Libraries
- Review of Private and Permissioned blockchain
- How to Set up a Local Private Ethereum Blockchain
- How to Run Geth on a Local Private Ethereum Blockchain
- How to Build a Local Private Ethereum Blockchain with Mining
- How to Run Geth on a Local Private Ethereum Blockchain with Mining
- How to Create an Account on a Local Private Ethereum Blockchain
- How to Use Ethereum Optional Flags with New Chains
- Review of Ethereum Options for Development and Testing
- Review of Ethereum Developer Chain Options
- Review of Ethereum API and Console Options
- Review of Ethereum Networking Options
- Review of Ethereum Transaction Pool Options
Articles and Tutorials on Hyperledger Family
If you like to learn more about blockchain development with Hyperledger, reading the following articles and tutorials is highly recommended:
- Introduction to Hyperledger Architecture, Projects, Tools and Libraries
- Complete Review of Hyperledger Fabric Architecture and Components
- Hyperledger Fabric for System Administers versus Developers
- How to use Prometheus and Grafana to monitor Hyperledger Fabric
- Blockchain Developer Guide- How to Install Hyperledger Fabric on AWS
- Blockchain Developer Guide- How to Install and work with Hyperledger Sawtooth
- Blockchain Developer Guide- How to Install Hyperledger Burrow on AWS
- Blockchain Developer Guide- How to Install Hyperledger Iroha on AWS
- Blockchain Developer Guide- How to Install Hyperledger Indy and Indy CLI on AWS
- Blockchain Developer Guide- How to Install Hyperledger Seth and Docker on AWS
- Blockchain Developer Guide- How to Configure Hyperledger Sawtooth Validator and REST API on AWS
- Blockchain Developer Guide- How to Build Transaction Processor as a Service and Python Egg for Hyperledger Sawtooth
- Blockchain Developer Guide- How to Deploy Ethereum Smart Contracts with Hyperledger Burrow
- Blockchain Developer Guide- How to Create Cryptocurrency Using Hyperledger Iroha CLI
- Blockchain Developer Guide- How to Explore Hyperledger Indy Command Line Interface
- Blockchain Developer Guide- Comprehensive Blockchain Hyperledger Developer Guide from Beginner to Advance Level
- Introduction to Hyperledger Sawtooth Blockchain Development
Articles and Tutorials on R3 Corda
If you like to learn more about blockchain development on Corda , reading the following articles and tutorials is highly recommended:
Articles and Tutorials on Other Blockchain Platforms
If you like to learn more about blockchain development in other platforms, reading the following articles and tutorials is highly recommended: