Vegetarians aside, everyone loves a good hamburger. And we all know what makes a good one. Patty grilled, not fried, to just the perfect doneness — we all have our preference. A ripe slice of tomato, crispy lettuce and onion (or not), pickles, mayo and ketchup. And gooey melted cheese all between a lightly toasted sesame seed bun. A side of fries, please. When it comes to something we like or need, everyone knows what they want.
Let’s apply this approach to the newest item on the technology menu; blockchain networks. Few understand it completely, and fewer have made it to the end of Satoshi Nakamoto’s Bitcoin cookbook. Yet we know what we want from it, and what we don’t. We don’t need to understand the inner workings of it to enjoy its benefits.
Blockchain’s must-have sides
In general, when we use computer networks there are things we absolutely need. Let’s start with a list of side-dishes we definitely want at our blockchain BBQ:
Side #1: Speed
No one wants to wait to eat … it’s gotta be fast. When we send or receive information over any network, or conduct transactions, speed is a critical component of satisfaction, and we already have many benchmarks; Netflix provides us streaming video in satisfying, uninterrupted high-definition. Would you renew your subscription if your Friday night movie constantly paused or hiccuped?
Our credit card transactions go through in a matter of seconds no matter how loaded the network is. How long would you wait staring at your shopping cart before you lose patience and click “Cancel”? Would you wait 5 minutes in line at Starbucks for your card payment to clear while your latte gets cold? Lack of speed is a show-stopper.
How do blockchain networks rank here? Looking at the the Bitcoin network, the patty is definitely undercooked; transactions can take several minutes to hours to complete. For the Ethereum network, 18 seconds, but for only up to 15 simultaneous users at a time. Speed is the price paid for increased security and decentralised storage.
New blockchain implementations are feverishly working on this problem so that mass adoption can take place. But these solutions are still marinating, with several contenders vying for first prize at the blockchain BBQ cook-off.
Side #2: Scalability
We will have to feed a lot of people at our BBQ. Hand in hand with speed, the network has to provide a high quality of service whether ten or ten thousand hungry users show up. If blockchain networks are destined to serve the masses, then they must be able to scale up without losing significant performance. So how’re we doing here? The Bitcoin network currently supports about 4.6 transactions per second. The second largest public blockchain, the Ethereum network, supports 15 transactions per second. That’s not a lot of grills for a lot of hungry cowboys, meaning long lines at the BBQ. By comparison, Visa supports 1700 card transactions per second, which feeds a lot more people, albeit with a higher entry price in the form of fees to support all the cooks in their kitchen — 17,000 employees.
For high-performance applications, It appears that the current blockchain frontrunners are not suitable for large-scale implementation, though they certainly have their place in applications requiring high security, immutability and low speed such as industries which must securely archive a long trail of immutable records such as healthcare, law, and real estate. For bitcoin, the main application has turned out to be speculation, or “Hodling”, in which case its blockchain simply stores static information (bitcoins) for long periods of time. Speed in this case is not an issue.
Side #3: Security
This is where blockchain shines. Just as we don’t want gate-crashers at our BBQ, our public and private information needs protection from unwanted visitors such as hackers, cyberthieves, and mischievous makers. Security is blockchain’s secret sauce. Our most precious and sensitive information, our financial, health, and legal records, credit card details, photographs and private correspondence all need protection from unauthorised persons, alteration and loss.
Current “carrier-class” cloud services provided by Amazon Web Services, Apple iCloud, Microsoft Azure, and others claim to be impervious to hacking or data corruption. Yet each service is a centralised entity managed by human beings. And glitches happen. Over and over. This is where blockchain can provide much higher security and invulnerability to data loss. With blockchain, there is no central point of storage to attack, no overworked IT staff to flip the wrong switch, and unauthorised alteration of data stored in the chain requires prohibitively large computing power.
Although in theory blockchains can be hacked, they are significantly more difficult to do so as compared to conventional client-server networks. The biggest danger is on the user side; all networks are required to allow authorised users to access them. This usually requires a combination of username, password and two-factor authentication (smartphone, fingerprint, etc). Blockchain or not, unauthorised access to user accounts can occur by simply stealing these keys, either by hidden camera or coercion.
The upside here is that vulnerability exists only on the individual user account level; the core blockchain network that stores vast amounts of data about large numbers of users presents a very small attack surface. Blockchain networks therefore receive three Michelin stars for the security of their contents.
Side #4: Low cost
One of the most frequently noted criticisms of the bitcoin blockchain is that it relies on intensive computing power, which means it requires a lot of hardware and energy to run. To keep the network running, miners often use huge computing centers with hundreds of servers. Mining even a single bitcoin can cost thousands of dollars.
That’s a lot of charcoal to keep the BBQ burning. Though the bitcoin miners get paid for their efforts, the high cost is a problem for the widespread adoption of the technology both in terms of hardware and energy. For blockchain networks to go mainstream, the mining process needs to be simplified such that new blocks can be created quickly, but also with nominal computing power and kilowatt expenditure.
In a follow-up article we will discuss blockchain “nice-to-haves”; the avocado and bacon that makes our burgers stand-out. For blockchain that includes standardisation, regulatory oversight, and eco-friendliness.
Inventing a new blockchain recipe from scratch
Instead of trying to force cryptocurrency-centric blockchain networks to work in the real world, we have designed the infrastructure from the ground up to address the shortcomings across the industry. We call it the “Catalyst Network”.
Our protocol is fast and lightweight, based on a new consensus mechanism that validates transactions quickly. A network that’s built for secure, decentralised enterprise deployment, while operating seamlessly with small, distributed IoT devices. A blockchain network that is low-cost, and scales to hundreds of thousands of nodes with the ability to process confidential and non-confidential transactions.
In short, a decentralised network that’s built to perform in the real world.