The blockchain is beautiful: Reliable, unhackable, and yet transparent. It provides intrinsic trust and un-changeability, in a package which is guaranteed for every user. And it’s nearly ten years old: Happy Birthday blockchain! However, is the blockchain everything we’ve been lead to believe, or is it already a somewhat ‘clunky’ old structure, slow and unfit for the purpose for which it’s being used?
The limitations of blockchain
Look at most ICOs and STO crypto projects, and you’ll see that blockchain and smart contracts are always somewhere in the marketing speak. Blockchain is the magic JuJu which has to be sprinkled around the offering to ensure uptake, apparently. However, right now the blockchain is more like a very early steam locomotive, crawling along a primitive railway line. We’re encouraged to believe it’s a high speed network of bullet trains, but sadly, not so. Blockchain has low transaction throughput, relatively high transaction fees, and then there’s the whole question of scalability. It’s been there from day one, but there’s always been the attitude of, ‘We’ll get that problem fixed later’. And we might.
But on the plus side, is blockchain fast? You betcha! Bitcoin is so lightning fast, that it’s capable of pushing through 6 transactions a second. - Wow, are you impressed?
Actually this wouldn’t impress a three year old – even one without a degree in computer science. Compare that speed to good old-fashioned Visa, managing 24,000 transactions a second, and you get to see how slow and limited a steam train we really have. PayPal manages around 200 tps. We need blockchains version 2 and 3 and more. It’s true that Vitalik Buterin is predicting 1 million transactions per second for Ethereum, ‘eventually’, but we better hope that the technology to enable that – such as the new hyper-improved Red Belly blockchain – is just around the next bend in the track.
Is Radix the answer?
Another answer may be the Radix protocol. The Radix Protocol sounds like the next movie in the Jason Bourne franchise, but in development stage it’s claimed to be managing nearly 8,000 transactions a second, and there is the promise of huge improvements to come, with the ability to pay anyone anywhere within 5 seconds. Here’s how the Radix whitepaper sums up the situation to date: “Bitcoin, and its success, has inspired others to take Satoshi's blockchain and apply it in many innovative ways. Ethereum is a notable example… However, blockchain implementations have several challenges, including scalability, efficiency and security. These are now beginning to hinder its progression into the mainstream.”
Note those telling words: hinder its progression. Whatever you may think of the Radix offering, the fact is that many people are looking over their shoulders and wondering, ‘Are you sure we’re on the right train?’ - We know that the theory of the blockchain is good, but are we getting tangled in ever more outdated and unsuitable old-tech?
So is the blockchain fit for purpose? Um, no: It’s a work in progress, and like any other technology there will be blind alleys that lead nowhere, and then hugely significant steps forward. Around the time of the first steam engines, people were also experimenting with huge plate cameras and the colloidal wet plate process, which is quite some distance from our contemporary abilities of taking an instant full color digital image, and then sending instantly to anyone, anywhere.
The blockchain will show a similar development curve. Won’t it?