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Scalability Solutions for Blockchain Companies

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Scalability Solutions for Blockchain Companies

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Over the past five years alone, VCs have invested over $1 billion into blockchain companies – and it’s hardly surprising why.
By 2024, the blockchain market is expected to be worth a surplus of $20 billion.  
However, despite the tremendous potential of the blockchain to completely revolutionize almost every corner of our society, there is still one major problem – scalability.

Why Blockchain Scalability is Such a Big Issue
Right now, figuring out how to create a blockchain that is decentralized, secure, and scalable without making significant compromises in one of these areas – scalability in particular – is a huge problem.
Whilst creating a system that is both decentralized and secure is less of a problem, creating one that has both of these properties and is scalable is the real issue.
As a result, making the blockchain more scalable is currently one of the most pressing issues in the crypto community.
It’s hardly surprising that companies are racing to come up with a solution to the problem.
Right now, there are a couple of solutions that particularly stand out.
‘Delegated Proof of Stake (DPoS)’ by EOS
You’ve probably heard of Proof of Stake (PoS) and Proof of Work (PoW) — but you might not yet be familiar with Decentralized Proof of Stake (DPoS).
EOS a competitor of Ethereum. It works by essentially nominating multiple ‘witness nodes’ to act as representatives to help make higher level decisions automatically without polling the whole network.
One of the major differences between DPoS and the other consensus models in that DPoS prevents a single party from being able to control a disproportionate amount of the network. Its aim is to make the process more decentralized.
For instance, if witnesses make poor decisions, they won’t get paid, and stakeholders will even have the ability to vote them out.
In addition, DPoS will make it faster to pivot to quickly meet the needs of the network if a change is made.
For example, bad actors will be able to lose their position and power within a network instead of simply relying on processing power from a centralized authority.
However, there have been criticisms by the crypto community that this method could actually be more centralized than both PoW and PoS, due to the fact that voting will be weighted based on the amount of EOS a user owns.
Considering that the top 12 EOS token holders own over 50% of the tokens, this could certainly be something that many users take issue with.
‘Lightweight Contracts’ by Ardor
One of the big problems with smart contracts today that is hindering scalability is that they require every single node in the blockchain to process and execute the contract.
But is this really necessary? The answer is: probably not.
To demonstrate this, Ardor is exploring a different approach, known as ‘the lightweight contract’, which it hopes will be both more flexible and more scalable than the current solutions available. In this approach, only the parties that have an interest in the contract will be required to process and verify it.
These lightweight contracts will provide pretty much everything that Ethereum smart contracts do. In addition, they’ll be integrated with everything Ardor already provides out of the box.
These built-in API features create a layer of flexibility and automation, resulting in a very powerful tool that can be used for developing more sophisticated server-side decentralized applications.
Using Lightweight Contracts for Oracle Implementation
Oracles provide the necessary data required to trigger smart contracts to execute (if the required conditions have been met).
They work by loading information from external sources and registering it on the blockchain. Essentially, they provide a bridge between the blockchain and external resources.
By leveraging lightweight contracts, Oracles will be able to interface with any external resource offering an API interface – including even those who require authenticated access, such as paid services.
One of the most important features of an Oracle is the ability to develop and deploy them quickly and efficiently.
As a result, Ardor lightweight contracts are ideal for Oracle implementation because they are not executed by every node in the blockchain.


Biraajmaan covers market trends of major cryptocurrencies. As a graduate in engineering, his interests lie in Blockchain technology. With over a year as a journalist, his articles focus on US and UK markets.
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