Blockchain Scaling: An overview of how blockchain scaling technology has evolved over the years

The blockchain market has achieved tremendous growth in a relatively short amount of time, far outpacing the adoption rates of other technologies and their applications such as the internet, smartphones and social media. However, mainstream adoption still remains a challenge due to the prevalent issues around security, transparency, and scalability. As the demand on blockchain systems grows, scalability issues in particular need to be addressed in order to maintain the speeds that meet the needs of a broader retail user base. 

Some of the most widely used blockchains such as Bitcoin and Ethereum have received criticism in the past for the networks’ increasingly high cost and slow transaction speeds, unable to offer appropriate entry points for widespread retail use. In particular, such networks have been facing congestion issues, failing to keep up with the increasing number of transactions that inevitably come with growing fame. 

Addressing these issues, developers in the digital asset ecosystem are continuously working towards improving the infrastructure that supports the decentralized economy. There have been many solutions to such congestion issues: the Ethereum Merge for example, which took place September 2022, was one of those initiatives. 

There is an entire sector within the digital asset industry of projects dedicated to alleviating blockchain congestion – with one famous example being Polygon. These projects are often referred to as scaling solutions. 

Blockchain scaling technology helps keep the blockchain functioning as expected, with respect to the number of transactions processed in a certain period of time even as network usage increases. Components of scalability are blocktime and size, transaction speed and volume, and cost per transaction.

For blockchains like Ethereum to become the ultimate programmable base settlement layer, they must be capable of competing with the likes of traditional finance juggernauts like Mastercard and Visa, which process up to 24,000 transactions per second. Amongst others include being able to host many more validator nodes and being free from security threats. Although not all of these factors are tackled by blockchain scaling technology, it plays a critical role in unlocking the next growth chapter for the digital asset industry. 

In this paper, learn about the fundamentals of blockchain scaling, the different types of scaling technology that has emerged over the years, and pioneering projects in the sector.