Sharding: Vitalik Buterin’s Last Hope To Save ETH

At the beginning of this year bitcoin’s blockchain could’ve managed around 3 to 10 transactions in second. Ethereum was kicking bitcoin in this department - it could boast 12-30 transactions easy. This was a breakthrough that Mastercard, Visa or American express haven’t even noticed. Which is understandable, considering that according to the David Tagt report, the evaluation of that Evercore ISI analyst, average daily amount within Visa network is around 65.000 transactions per second. Only that mere fact makes all claims to challenge or change modern payment systems via blockchain dubious at best.

Sure, there are alternative blockchain networks that offer their solutions that possibly could or already do it, but in many times they end being stress tested only in a controlled environment with mere hundreds of machines in the network. This is not exactly a fair comparison since bitcoin deals with from 13 to 22 million computers in its network.

There are alternative solutions to the task at hand, like lightning network and plasma. They solve some of the issues, but they do not offer a solution. Sure, the lightning network seems like a decent idea, but this “lighting” sparks a full-blown fire of criticism from skeptics. Starting from the fact that this kind of network makes currency that is famous for its decentralization pretty much centralized and adds a third party into the p2p system, which basically means that it becomes nothing more but another digital currency.

There are solutions from major payment processors like Mastercard with their recent patent. It means that crypto will be “anchored” to the fiat that will allow it to travel at the same speed. This way it will be possible to equate these two and issue a crypto card, so far no bank has offered to create a credit card like that.

However, despite all those ways - stated ideas are nothing but crutches for the industry that make many people unhappy since they see them as a deviation from the bitcoin original masterplan and possible death of the crypto as we know it. Or at least end of the Satoshi’s visions, which is a pretty big deal as well.

But there are real and clear solutions that are pretty much a bicycle from the IT world and do  not require a breakthrough. This “wondertech” is called sharding, and it is implemented in numerous databases and networks. If put it simply, it can be described as a process when big information chunks are spread horizontally and it dramatically reduces pressure on the network and ups the speed inside of it.

In blockchain, it looks a bit similarly - nodes of the blockchain form a shard, where a load of info is stored in numerous bits and pieces that greatly helps the network. Because this way they don’t load all the info in the blockchain at once, so it helps to reduce the pressure on the network, which is essential for the scaling up. And nodes with the information have only separate parts of the data, so decentralization in this case is obvious, as no nodes in the shard have the full info.

But it is not that easy - sharding simply does not work with all the networks, because some systems can’t work with it. First currency of the digital world, bitcoin works on the POW or proof of work principle. With the sharding technology in place it does not provide a substantial level of protection. For example - if there is a hypothetical sharded blockchain network with 100 nodes in it, anyone who can control five nodes can maliciously take control of the other nodes, by rerouting computing power he has in control, instead of spreading it through the network. So basically - as long as blockchain stays fully PoW powered - there is no way to implement sharding in the bitcoin safely.

It’s much easier with the Ethereum. Sharding can be fully implemented in the system, buthard work should be sone for it first. And considering the fact that last time they did it, price for the cryptocurrency of the network dropped, it’s safe to assume that it will lose in the value of Ethers once again. Which is okay at the cryptomarket, but now, considering free falls at the market, it might mean a shot in the foot from the network’s devs.

Some platforms were using sharding at the very beginning, and right now they are at the very beneficial place in comparison with rival networks. Zilliqa offered high transaction speed - considering that they can pass almost 3 thousand of operations per second instead of 15-20 like of their rivalries it makes them more than impressive. Mostly because they offer a real alternative.

But despite the fact that sharding is the “answer number one” to the main issue of the blockchain, it has a number of nuances that make it more complicated. For example - so far there is no way to trace which node doing the particular transaction. Second one - there is no algorithm of the trustless exchange in place yet, leading to the third issue - there is no mechanism of the end process confirmation in place.

This set of issues prevents a number of blockchain networks from implementing of sharding quite slim. Basically, only Ethereum is prepared to jump the shark and do it. However, this is more of a desperation-driven innovation.

For quite a while second main crypto in the market was unable to boast any numbers. The main issue here is simple - most of the predictions about Ether ending up 100% separate crypto with its own course and different value from the bitcoin failed to become a reality. This and freefall of its value fails to impress many potential investors that prefer to sell off or wait up to buy cheap.

Buterin’s “kingdom” is not doing too good indeed and many people are talking about the inevitable collapse of the system. Also, the problem is - right now, unless Ethereum does something, it will continue to slowly rot, crumbling under the yoke of problems.

But there is also another possibility. Vitalik and development team can give another “last stand” and do something drastic that will either win hearts and minds or fall flat. Because odds are people that talk about the deadly consequences of the hard fork for the Ethereum might be right. Everything is a definite possibility.

Back in 2013, when Ethereum development team was describing their idea to people by releasing the White Paper of the project, many people considered them just another bunch of students with a "revolutionary" idea and invested in eastern poland or bitconnect. But the very next year they gathered $18 million and became the foundation of the Ethereum, the second most significant project in the history of the cryptoverse.