#BlockchainScalability #CryptoLingo
So Crypto will only be as successful as its ability to scale up along with the rate of growth and user adoption. There will be an inflection point in adoption, but if the blockchain network is unable to handle the traffic and increased throughput ... things could get awkward. The crypto markets have not been kind this week and from my understanding it is the result of the infrastructure bill and the negative and ambiguous wording towards the crypto industry. This will hopefully be clarified in 2022 before it takes effects I think in 2023 or 2024 ... which sadly means people will lose money in the meantime due to this pageantry.
The Breakdown:
- "To compete with legacy systems of payment processing, blockchain networks must become highly scalable — capable of accommodating an exponentially growing number of users, transactions, and data." (Cryptopedia)
- Scalability per Cryptopedia is addressed by "Layer 1 Scaling Solution" and "Layer 2 Scaling Solution"
- "Layer 1 Scaling Solution" is optimization via native blockchain to enhance performance
- "Layer 2 Scaling Solution" is third-party protocols that interfaces w/ original blockchain to increase "transactional throughput."
How do I find out more about Blockchain Scalability and Solutions:
- "A commonly used comparison to indicate the gulf in scalability is that Bitcoin processes between 4–7 transactions per second (TPS). Visa, on the other hand, processes approximately 1,700 TPS." (Cryptopedia)
- Layer 1 scaling solutions to read up on are block size, rate of adding next block, consensus protocolo (proof of work vs staking), and sharding
- Layer 2 scaling solutions to read up on are outsourcing transaction processing and traffic, nested blockchains, state channels, and sidechains
What should I know about Blockchain Scalability before investing:
- "Scalability is crucial because it represents the only way for blockchain networks to reasonably compete with legacy, centralized platforms with rapid settlement times." (Cryptopedia)
- In order to out compete legacy systems, blockchain technology will need to at the very least match or exceed legacy system's existing high levels of scalability.
- The goal is to find a way to increase scalability without sacrificing security or decentralization and the projects that accomplish this stand to gain the most.
What are the downsides of Blockchain Scalability issues for investing:
- Blockchain technology is only as good as its ability to handle increased adoption and throughput whether this is more people or more transactions, especially w/ micropayments
- This is an evolving field and process so there will likely be some growing pains involved
Reference: Cryptopedia / Video: https://www.youtube.com/watch?v=sZ92hI6rEcs
P.S.: I think ETH2 and $ADA are both exciting innovations to the blockchain that will hopefully enable increased scalability. Which ones are you excited about? Other ones I have my eyes on are $SOL and $AVAX
#MakeTheWorldBetter
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I guess the other question I have is if the US Government were concerned about crypto what would stop them from investing heavily in a proof of stake blockchain so that it could be a validator node and then earn interest off the network essentially as a tax. If you thought of blockchain like a toll free way ... they would essentially just collect tolls. Why not develop and integrate w/in the syste…See more
@ctsshah good morning, $MANA is another that uses block chain technology and is also involved in virtual reality.
Blopspop@etercilla
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@vbtiger16 ya I'm starting to take a big swing at Mana... we will see how that turns out. Also scalability is super important in this space due to latency especially if we get into virtual reality and augmented reality
Great post! I am in on $MANA $SOL $AVAX $LRC and $WAXP
@theresa I was wondering what got your attention about LRC? I had briefly traded that one but then consolidated into AVAX/SOL/MANA
K
Great info & thanks.
Comparing apples to oranges is something I'm often accused of. I have begun taking up a position on polygon MATIC and I believe the six month chart gives a good view of what we can expect the consolidation period for Shiba Inu to look like. Don't sell for a loss and on coins that require gas fees make sure you're waiting to take profits that are worth the gains lost to gas fees. Shiba will make al…See more
@onyangoK you are welcome
@zipzander I think Crypto for right now doesn't have wash sale so Coinbase converting can be nice I think if I understand it correctly. Can convert take the paper loss and just move it into something else or convert back to the original. Or am I misunderstaning the current rules?
@A007Kenny and @BREYZEHN was there any talk in Miami about the infrastructure bill and the language contained within it regarding crypto?
@ctsshah the idea of government investment in POS is neat, especially if it used revenue to offset taxing folks for helping stake - which is in my opinion unconstitutional
Thank you!! I pulled out of crypto yesterday, realizing all l was going to do is gain a little here or there but lose a lot mostly due to shear lack of knowledge
@AnthonyAD China is creating its own currency. Why not just be a major player in staking and generate revenue off of the entire crypto community that is global
@ksull60 It is a fast moving and sometimes erratic space since it is so new. Likely to slow down in the future but probably will be more expensive to get entry into the market at that time. The money I lose w/in crypto I treat as my price of education in the space. I just made this video on Crypto exposure that is indirect without actually holding Crypto that might be of interest https://www.youtub…See more
Awesome research and thanks for sharing bro. You always on point in the am. Thanks for being awesome Doc and a awesome part of this community
@GetSlade you are welcome!
What we learned from Miami... hmm
Well, we learned that big money is holding $BTC as an hedge against the dollar just like gold. It's a store of value for them. Most don't care about the scalability of BTC itself. They are moving big money which isn't done frequently.
As far as Layer 1 technologies, they invest in those technologies for financial gains. They understand that their will not be a sin…See more
@ctssha I like that it's a lower market cap and entry price while being a faster, cheaper transaction than pushing directly to $ETH.
Bonus: the $GME rumor hype which could lead to WSB hype and even more 💰 in my 👜
#apehands #diamondstrong #hypewords
@theresa very cool! Ty
I like AVAX
D
Dakota@growinghost
Everyone NEEDS to check the new posted news of the game $SOL is making with some BIG BIG name game developers. It's a play to earn game, which requires a mask of a unique identity to yourself, but yet anonymous. This could be a game changer to not only crypto, but the efficiency of their network to be able to do this.
I'm no professional, and this isn't advice. However this really sparked my eyes…See more
Sweet! Thank you 😁
@growinghost I think you mean star atlas, it does sound sick, and if it does come to fruition it looks like a blast
Thank you for the information again 🔥
@dfwsas you are welcome! All my #CryptoLingo are here on this playlist if interested - https://www.youtube.com/watch?v=G3rrb7gIjMc&list=PLn0fZqMvSiYB5a0KPvgvMYFzYqmA6aK6F
☝️I need to learn this lingo so bad
