Scalability Struggles of Leading Blockchain Networks
Previously, at various conferences and presentations, Buterin emphasized that the Ethereum blockchain protocol and decentralized blockchain networks, in general, are struggling to deal with scalability issues.
In September 2017, during an interview with venture capital investor Naval Ravikant at the Disrupt SF 2017 conference hosted by TechCrunch, Buterin noted that bitcoin and Ethereum have been processing three to six transactions per second at peak capacity. He added that for the blockchain to support large-scale payment networks such as Visa, stock markets like Nasdaq, and Internet of Things (IoT) networks, it will have to process hundreds of thousands of transactions per second.
“Bitcoin is currently processing a bit less than three transactions per second and if it goes close to four, it is already at peak capacity. Ethereum has been doing five per second and if it goes above six, then it is also at peak capacity. On the other hand, Uber on average does 12 rides per second, PayPal several hundred, Visa several thousand, major stock exchanges tens of thousands, and in IoT, you’re talking hundreds of thousands per second,” said Buterin.
During the OmiseGO AMA session, Buterin stated that second-layer scaling solutions that are currently being tested on the Ethereum testnet could enable the Ethereum blockchain network to support large-scale decentralized applications with millions of users by taking an innovative approach in optimizing the blockchain…