The Challenges of Scaling the Bitcoin Network
Bitcoin has a scalability problem due to its supporting blockchain technology. This article explores some of the main challenges of scaling the Bitcoin network.
It took less than a decade to become mainstream. While adoption was slow initially, more people and businesses have embraced Bitcoin, making it the most popular digital currency. While most Bitcoin users are only concerned about its uses and benefits, some are also concerned about other issues like scalability.
Bitcoin’s network has scalability problems, and this is raising growing anxieties about the future of Bitcoin. On the one hand, Bitcoin is growing in popularity, and crypto analysts predict more growth in the future. On the other hand, the blockchain network that supports Bitcoin will need scaling to accommodate the growing demands. That’s where challenges lie.
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Understanding Blockchain Network
The blockchain network supports Bitcoin. Blockchain is a shared network with multiple nodes spread across the world. Nodes are computers that verify Bitcoin transactions on the blockchain network. Blockchain provides a decentralized control system where no government, organization, or individual controls can control the network.
Every node on the Bitcoin blockchain network has an equal right and power to manage and govern all transactions on the crypto network. They do this by solving complex mathematical problems in a process known as Bitcoin mining. When this happens, miners add a new block to the blockchain.
Generating a single block on the blockchain network takes about ten minutes. Therefore, if many transactions need verification and addition to the Bitcoin network, it will take more time. That’s where the scalability problem in Bitcoin’s blockchain emanates.
Transaction Volumes
Under the current Bitcoin blockchain protocol, where adding a single block takes about ten minutes, the network processes up to seven transactions every second. That’s considerably slower than other networks like Ripple, which processes approximately 1,500 transactions per second. Since the blockchain protocol embeds the processing time, changing it isn’t easy.
As demand for Bitcoin surges, Bitcoin transactions are increasing. The demand for verifying these transactions on the blockchain network is growing. Yet, the capacity of the network to process Bitcoin transactions remains the same. That means there needs to be a better match between demand and supply.
This problem could be solved by expanding or increasing capacity or scaling up. It would probably mean increasing the speed of processing transactions by increasing the nodes and reducing the block time to less than 10 minutes. However, this takes work.
Satoshi Nakamoto developed Bitcoin’s blockchain as a tamper-proof system. The creator remains a mystery, and so it is impossible to engage him, them, or it in scaling Bitcoin. Additionally, the developer made blockchain technology unique and challenging to interfere with. Even some nodes working on the network need help understanding it.
With such complexities and unknowns, it becomes a challenge for anyone to scale Bitcoin. It would require significant changes to the current network protocol to increase transaction speeds. But this seems impossible considering the original developers developed a water-tight system that cannot be tampered with.
Finally, there is also the issue of the unintended effects of Bitcoin scaling. Bitcoin’s blockchain has proven to have more significant potential than just supporting Bitcoin. For example, it can support smart transactions. Before scaling Bitcoin, it is essential to consider all possible impacts, including on the existing uses. It’s almost impossible to rule out the question of crashing the network.
Conclusion
Despite a growing demand and growth projections, Bitcoin presents serious scalability challenges. The current Bitcoin protocol is ‘cast in stone,’ making introducing any changes that would enhance scalability challenging.
