A new generation of blockchains

Feb 27, 2024 3:14:38 PM

As it was mentioned before, one of the most important issues to be solved in the ecosystem is scalability. While a payment company like VISA can process over 20,000 transactions per second, Bitcoin is limited to 7 transactions per second, and around 20. This means that none of these protocols, by themselves, are capable of acting as an electronic payment system or large-scale global computer.

To solve this problem, other blockchains, also with the ability to execute smart contracts, have introduced different mechanisms. With a greater focus on scalability, blockchains like , Solana, EOS, among others, are capable of processing thousands of transactions per second, scaling just like traditional payment companies.

These other blockchains also brought improvements over Ethereum. While smart contracts on Ethereum are written in a language called Solidity, designed for this purpose, other blockchains allow you to write smart contracts in more familiar languages. In the case of EOS, it is possible to use C++. Solana lets you write smart contracts in Rust. Neo lets you use other programming languages, like C#, Python, Java and Go.

Another advantage of such new blockchains is the time it takes for a block to be considered finalized. That happens when a block can no longer be reversed. While Bitcoin needs 1 hour for a transaction to be considered probabilistically irreversible, Neo blocks are considered finalized in single confirmation. That is called single block finality.

Other functionalities have become fundamental within the blockchain ecosystem. One of them is the need for internet access, or Oracles. An Oracle is a way of introducing information from the outside world into the blockchain, which is a deterministic network and therefore must be closed in its own environment. Other features we need to mention are a decentralized storage environment and a domain-based identity system. Such ingredients only exist in Ethereum through third parties, not natively.

The Neo network incorporates these and other ingredients natively. It has a built-in Oracle system, as well as a decentralized storage system and its own domain name system called Neo Name Service. We will talk about such functionalities until the end of this course.

We need to understand that blockchains are still a maturing ecosystem, whose environment is still in development. However, it is increasingly being used not only by people looking for a decentralized environment to interact, but also by enterprises looking for a tamper-proof ledger that can be distributed among defined participants. Ironically, Bitcoin was created by Satoshi Nakamoto so that people would not depend on banks and big companies, and blockchains are currently being tested by banks and big companies to increase their security and effectiveness.

It is still too early to say what the future of blockchains will be, but their evolution has been continuous, year after year, and their use is increasingly widespread. New revolutions in this ecosystem are expected, and maturity must be reached sometime in the coming years.

Blockchain ScalabilityNeoSolana