Blockchain being the technology of the future is the hot topic of present tech-savvy people. At this moment, many companies are using Blockchain techniques to secure and transfer their data from their clients or vice-versa. But even future tech can face old school roadblocks. One of these roadblocks is the Scalability of the Blockchain. Today we will discuss the issue most people face while using Blockchain and will try to find a way to pass through this scalability roadblock. Let’s find out, shall we?
Does Hedera Hashgraph Development Solve Blockchain’s Scalability Issue?
First, before moving forward with our discussion, we need to provide the basis of Blockchain.
What is Blockchain?
Blockchain refers to the records that are stored in the form of blocks and are linked to each other by using different cryptography methods. Every single block of record contains a cryptographic hash of the previous block, a transaction data and a timestamp. You cannot modify the data present in Blockchain because of its distributed ledger property, which can record transactions between the service provider and the client in a verifiable and permanent way.
In addition to this, the inter-node communication protocol is used in peer to peer networking to manage distributed ledger of the Blockchain.
If you try to change the record of a particular block, you will activate a snowball effect. Meaning you are required to change the data for all other blocks present in the Blockchain.
Thus, making Blockchain design extremely secure. The came into existence by the unknown group of people named Satoshi Nakamoto in the year 2008. The primary purpose of building Blockchain is to provide transaction ledger for the cryptocurrency Bitcoin. In other words, Blockchain is also said to be a payment rail.
The Blockchain uses decentralized and public digital ledger structure across many computers, making it impossible to alter the record retroactively. As a result, the participating parties can easily verify and audit the transactions independently.
Different Types of Blockchain
Now let’s discuss different types of Blockchain and where can we use them.
This particular form of Blockchain has no access restriction. Any individual with online connectivity can use it for transactions to become a validator. This type of Blockchain is used in Bitcoins and Ethereum.
As the name defines a private Blockchain is used for the private use only meaning you need to have permission from the network administrator before accessing the private Blockchain. In this type of Blockchain, the permissions given to validator and the participant are different.
Blockchain Companies which use Private Blockchain wants to know and keen to embed Blockchain in their system but don’t feel secure by public networks. In addition to these, companies can use private Blockchain for their accounting and record maintaining without providing any access to sensitive data to the public.
You can see from the name that Hybrid Blockchain is the combination of the two we have just mentioned above. The hybrid Blockchain takes some useful design characteristics from Public Blockchain and some from Private Blockchain.
It allows the validator to decide which information can be accessed by the public and which one should remain private. Furthermore, you can achieve decentralization to first centralized private blockchains according to your needs.
Depending on the hybrid Blockchain its architecture, multi-cloud solutions allow storing data in compliance with General Data Protection Regulation and limitations such as geographical while also leveraging bitcoin’s global hash power to decentralize transactions.
What is the Blockchain Scalability Issue?
We all have witnessed the rise and the fall of cryptocurrency in the year 2017, causing the number of tokens, exchange, investors, and users to rise, which eventually lead to scalability issue. As the data of transactions start to pile up, the current generation Blockchain tech can’t withstand its weight.
As a result, serious research has to be done to eradicate the scalability issue to secure Blockchain for the future from its present.
Let’s find out the limitations of Blockchain and find out which one caused the scalability issue.
There are four significant limitations which are given below.
Blockchain requires large networking size
First and foremost, we need to talk about the transportation method of the data, which is through the network. Blockchain requires several users for its network to work as an ideal system. In case a Blockchain doesn’t have a robust network with highly distributed nodes, you can’t use it at its optimal reap.
Therefore, it could lead to potential system fatality, making Blockchain not useful for multinational companies.
Rising transaction fee
Before Bitcoin exploded it what is now the transactions done by bitcoins were almost free of cost and secure, making it one of the best way to transfer money between two individuals. But far more people are using this service more often making extra workload on the network. Thus, making the transactions bit costly than other methods and sometimes time-consuming as well. Moreover, in rare case bloating occurs in Blockchain, which forces the miners to reprocess their aggregate data and rerecord the information from the start.
The 51% Attack
What if in a room of 25 people I told you something, and it’s not true and you go and tell that same thing to 20 different people now the people who are belives that what I said is truth is 22 and only remaining 3 knows that its a lie but their number won’t be considered and they will be counted as a liers.
Just like the above example if more than fifty per cent of the computers that are working as nodes to service the network shares the false information, it will become true making the whole system corrupt.
The Complexity of Blockchain
Blockchain is a new technology, and it has its language. To understand and make Blockchain run correctly requires highly specialized professionals. You just cannot put an amateur in the project.
There are several Blockchain and cryptocurrency courses which can help an individual understand how to work with Blockchain, but in the end, its still quite complicated industry can’t be studied thoroughly overnight.
After finding out these four significant limitations, we were able to a restriction, which caused the scalability issue. It’s the first one, the requirement of extensive networking system. There’s a solution to this problem which is Hedera Hashgraph Development
What is Hedera Hashgraph?
Hedera Hashgraph is the public Blockchain which is based on distributed ledger technology which works on a graph like structure where every single node communicates with the other and share the information. The report is taken out by constructing a graph of connections. Moreover, the data of links are stored in events.
The Hedera Hashraph relies on virtual voting and Gossip about Gossip so the system could have consensus. This protocol allows Blockchain to work without facing any limitations.
Gossip About Gossip and Virtual Voting
In this technique, every node shares its information to every other node. Thus, each node has its information and information on all the other nodes present in the Blockchain. As each node has the information of the other nodes, with this protocol one node shares its information to other random node and the process keeps going on until every node has a small chunk of information
The Hedera Hashgraph does not require leader based system and proof of work, thus, making it more cost-effective along with high performance.
Other issues arise with the scalability is the speed of the transaction. As we know Bitcoin can undergo 7-10 transaction in a single second, Ethereum can do 15-20 transactions in a single second, and hyper ledger performs thousands of transaction. But leaving all these three behind comes Hedera Hashgraph which allows hundred of thousands of transactions in one second because of data being able to travel exponentially throughout the network.
As a result, the data transfer is twice in terms of size as well as in terms of speed.
Hedra Hasgraph doesn’t require a lot of computing power as it primarily performs its task by the help of Gossip protocol, which enables it to hangle 50,000 transaction at the same time. Thus, lowering the scalability cost and working at more cost-efficient speed.
As the question stands, whether, Hedra Hashgraph Development can solve the Blockchain’s Scalablitliy issue? The answer to the question is yes it can while maintaining the cost, speed, and most importantly, the security for which Blockchain was developed at first. Although it does have some flaws like at this moment, we can use Hedera Hashgraph only for the private network, meaning it can’t be used for public transactions.
As a result, we can’t deploy it on a larger scale yet. But research is still going on, and sooner or later we can subdue the limitation also.