At the RISE conference held in Hong Kong, the largest technology conference in Asia attended by 15,000 attendees, Ethereum co-founder Joseph Lubin said that the Ethereum blockchain has entered phase two of its development, following the launch of the most complicated app on its protocol.
Hundreds of Thousands of Transactions Regularly
As CCN previously reported, the open-source developer community of Ethereum led by prominent developers like Vitalik Buterin, has been focusing on the development of layer-two solutions Plasma and Sharding, which combined have the potential to increase the capacity of the Ethereum blockchain network to one million transactions per second.
During a panel discussion at the conference, Lubin emphasized that in the near future, the Ethereum blockchain protocol’s main chain will be utilized as a trust system and layer-two networks will mostly handle the heavy load of processing large amounts of data.
“[Ethereum is moving] into a space where it can serve as the layer one trust system, and built into Ethereum we’ll have hundreds of thousands of transactions in the layer two systems and we’re going to see that ramified this year.”
Essentially, solutions like Sharding and Plasma leverage the security of Ethereum’s layer one protocol to securely process information in a highly efficient manner. Because Plasma operates as a multichain protocol with a network of minor blockchains while processing small payments as a micropayments channel simultaneously, the integration of the two solutions are expected to create an ecosystem wherein any decentralized application (dApp) can be deployed and operate without facing scalability issues.
Some crypto and blockchain projects have already employed unique off-chain systems to batch payments and only send transactions that absolutely need to be processed on the main chain. 0x, for instance, which operates as a base layer for decentralized exchanges, has been processing most of the buy and sell orders on decentralized exchanges off-chain and broadcasting batched transactions to the main chain to reduce the burden on Ethereum.
Decentralized prediction market platform Augur, which its founder Joey Krug described as the most complicated decentralized application, has launched on the Ethereum blockchain protocol after years of development.
The launch of Augur on the smart contract protocol of the Ethereum blockchain took longer than any other project currently in existence due to the difficulty of deploying its prediction market on a decentralized network that relies on smart contracts to esttle information.
In May, Krug said:
“Augur’s about 10x more complex than the second most complicated ethereum project, makerdao, which has about 10 contracts vs augur’s 100 [complexity isn’t a good thing, and the augur team has tried to make it as simple as possible, it’s just a really complicated endeavor].”
“Engineering dapps is more risky than engineering underlying blockchains imo. It’s also harder, having been involved with both,” he added. “An underlying chain has no UI, little UX concerns, can fork if it runs into trouble, and doesn’t have to be *easily accessible* in a decentralized way.”
As the layer one blockchain protocol of Ethereum improves in security and layer two solutions provide scalability, complex projects and sophisticated dApps that require significant amount of data processing capacity to perform — which include decentralized exchanges, prediction markets, and stock markets — will be able to perform and operate seamlessly.
Joseph Lubin Image from YouTube
Featured image from Shutterstock and charts by Tradingview.