• Markets
  • Crypto
  • Web3
  • Culture
  • Opinion
  • Politics
Subscribe
  • Login
  • Register
No Result
View All Result
  • Markets
  • Crypto
  • Web3
  • Culture
  • Opinion
  • Politics
No Result
View All Result
No Result
View All Result

Vitalik Buterin: “More Pessimistic” About Scaling Through Second Layers

22/08/2019 17:38
4 comments
Vitalik Buterin at Stanford Blockchain Conference, January 30 2019

Vitalik Buterin, the ethereum co-founder and its most prominent developer, has publicly stated he is becoming a bit pessimistic about scaling through second layer networks like the Lightning Network (LN) or the still in development eth version called Plasma.

“I have been getting more and more pessimistic about off-chain-data L2s over time. Vlad Zamfir is right; they’re just hard to build, require too much application-layer reasoning about incentives, and hard to generalize,” he said.

Buterin is an adviser to Plasma, or at least was during the project’s ICO, OmiseGo, in 2017.

He also appeared to be working closely with its lead developer, Joseph Poon. Two years on, however, Buterin says:

“Data withholding is the single hardest risk to design incentives around!…

Hard to generalize because they require specific reasoning about beneficiaries (who has the right to exit a uniswap contract on a plasma chain? What about the root ENS contract?)

Also Plasma exit games get harder when you can make changes to an account without the recipient’s consent, as you can’t assume honest users know their own latest states.

Channels cannot support “objects of public interest” (eg. Uniswap) at all.”

He specified “off-chain-data L2s” to exclude from his pessimism things like Zk-Snarks based scaling solutions.

In a nutshell, these solutions keep account of movements of funds deposited in a smart contract through snarks by creating mini-sidechains of sorts with the end result being a compression of transactions by kind of bundling them in these sidechain blocks which translates to some data/bytes being stored on chain, but far less than for a plain transaction.

Responding to a question on how putting data on-chain helps, Vitalik Buterin said:

“On-chain you can just do an interactive verification game to figure out who pushed a bad state. IV games favor defenders so strongly you don’t need to care about who has the incentive to defend so much.”

This application of snarks or starks to scalability has come to light only this year with it potentially a solution especially in the back-end as conceptually it could perhaps develop to the point you just copy paste some lines of code and so incorporate it into your dapp.

This method also avoids many pitfalls with LN, Plasma, or the like. Chief among them, there is no need for collateral and there is no, somewhat “manual,” account keeping whereby a file on your own local computer records a transaction.

This “manual” or local record keeping can lead to problems with the solution being trusted intermediaries called watchtowers.

As unappetizing as that may be, there could also be a fundamental technical flaw in that Lightning Network fees may have to cost as much or even more than on-chain fees.

There have been no published models on LN economics, nor even any basic maths as far as we are aware, but recently it was revealed someone is locking $5 million worth of bitcoin to earn $20 in fees on LN per month.

That’s obviously not something that can work, with LN fees so having to be 10 cent to just cover on-chain fees while bitcoin’s on-chain fees themselves are in the cents. That’s while ignoring the need for profits from locking this $5 million, or the cost to create a secure system for this rich LN node/operation, and so on.

In LN they do speak about what can be called channels squared, or factories as they call them, with the aim being to avoid on-chain transactions, and thus fees, but last time we glanced at that, we were told it’s all theoretical.

So there may be some sort of realization that this actually might not quite work as a solution to scalability beyond very small niche cases.

But compression through snarks might work. Sidechains could too especially in a system of smart contracts like in ethereum. There they call it sharding, although with differences but conceptually sort of the same thing.

Now whether either of those two can work in a decentralized and trustless manner, is for the future to say, but we may well actually find out that Nakamoto was ultimately right.

Copyrights Trustnodes.com

Related Posts

The bitcoin train, starting its journey?

Bitcoin Nears $27,000 on Bank Troubles

Fed's balance sheet, March 2023

Not-QE is Back

Banks Bail Out Themself to Fed’s Applause

Only 30% of Arbitrum Users Receive Airdrop

Load More
  • Trending
  • Comments
  • Latest
Credit Suisse

Fed Swaps $9 Billion to Swiss National Bank, Bail Out For Credit Suisse?

The new New York

Crypto, Now Safer Than Fiat

Arbitrum abstract

Only 30% of Arbitrum Users Receive Airdrop

BlackRock's CEO Larry Fink

“Very Interesting Developments” Happening in Crypto Says BlackRock’s CEO

The bitcoin train, starting its journey?

Bitcoin Nears $27,000 on Bank Troubles

Fed's balance sheet, March 2023

Not-QE is Back

JP Morgan's CEO Jamie Dimon and Goldman Sachs' Chai Craig Blankfein back in 2016

Banks Bail Out Themself to Fed’s Applause

Arbitrum abstract

Only 30% of Arbitrum Users Receive Airdrop

Comments

Latest News

  • The Demise of Signature Bank, A Crypto Contrast
  • Fed Increases Global Liquidity
  • Bitcoin Nears $27,000 on Bank Troubles

About Trustnodes

Terms of Service

Privacy Policy

Our Ethics and Values

Trustnodes Newsletter

(You have to be a paid subscriber)

Trustnodes © 2017-2023. All Rights Fully Reserved. For any Enquiries contact@trustnodes.com RSS Feed

No Result
View All Result
  • Login
  • Sign Up
  • Cart
  • Markets
  • Crypto
  • Web3
  • Culture
  • Opinion
  • Politics

Trustnodes © 2017-2023. All Rights Fully Reserved. For any Enquiries contact@trustnodes.com RSS Feed

Welcome Back!

Login to your account below

Authenticate with MetaMask Loading...

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

*By registering into our website, you agree to the Terms & Conditions and Privacy Policy.
All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?