What is Holding Back The Blockchain?
I suppose it was the fact that sounded nice and it had the word “ether”, referring to the hypothetical invisible medium that permeates the universe and allows light to travel — Vitalik Buterin on why he chose the name Ethereum
Genius is the ability to put into effect what is in your mind — F Scott Fitzgerald
As I write this article, I witnessed a week where Bitcoin lost more than 23% of its value and Ether lost more than 27% of its value. Understandably, many thought the bubble had burst considering there is nothing backing today’s Crypto Currencies. They could be right but this article explains why they may not. Nobody knows for sure. The future of Blockchain’s global expansion depends on a new consensus building mechanism called Casper whose development is being led by Vitalik Buterin and Vlad Zamfir. This article explains why these two developers hold the key to the next evolution of the Blockchain.
What Prevents Blockchains From Going Mainstream?
The number one problem for the Blockchain to go mainstream is scalability. By now, you have probably read about the hideous amount of electricity that Bitcoin’s Blockchain consumes. If you have not, let me put it into perspective by using the Bitcoin Energy Consumption Index referenced here. As per the model, Bitcoin mining consumes 47.3 Twh (Terawatt-hours) of electricity every year. In other words, this is enough electricity to power the country of Singapore or 0.21% of the worlds electricity consumption which leaves an enormous carbon footprint if the electricity in question is generated by coal power plants. I think you get the picture. The Visa network can process approximately 2000 transactions per second versus 5 to 7 for Bitcoin and possibly 100 for Ethereum.
The Proof of Work (PoW) algorithm that the existing Blockchains including Bitcoin and Ethereum employ to validate transactions is extremely inefficient. Think of the inefficiency as the price to pay for…