Can new scalable blockchains solve the blockchain trilemma?

The blockchain trilemma—balancing decentralization, security, and scalability—has long been a central challenge in the development of blockchain technology. Traditional blockchains, such as Bitcoin and Ethereum, have grappled with trade-offs between these three pillars, often sacrificing one for the benefit of the others. However, a new wave of scalable blockchains is emerging, promising to disrupt this paradigm and potentially solve the blockchain trilemma. In this article, we delve into the capabilities and implications of these innovative platforms.

Traditional blockchains, exemplified by Bitcoin and Ethereum, have struggled to reconcile the trilemma due to inherent design constraints. While Bitcoin prioritizes decentralization and security at the expense of scalability, Ethereum has faced scalability challenges as it seeks to accommodate a growing ecosystem of decentralized applications (dApps) and smart contracts. As transaction volumes increase, congestion and high fees have become significant pain points for users and developers alike.

Scalable blockchains represent a paradigm shift in blockchain design, leveraging innovative consensus mechanisms, sharding techniques, and layer 2 solutions to overcome scalability limitations while preserving decentralization and security. Platforms like Solana, Avalanche, and Polkadot are pioneering scalable architectures that promise to process thousands to millions of transactions per second without compromising on decentralization or security.

The prospect of solving the trilemma is one that many developers find fascinating. And at the moment, Venom blockchain is looking to bring a future where this issue is a thing of the past.We spoke with the blockchain’s developers to understand their approach to building what they believe to be the future of the technology.

• What would you describe as the state of Web3 at the moment?

In the blink of an eye Web3.0 became a $2.5 trillion dollar industry! That's bigger than the GDP of Italy or Canada, and it's still early days. Every year the pace of development gets quicker and multiple use cases announced by companies are daily, it is impossible to keep tabs on everything. At this rate, Web3 will be a $20 trillion plus industry by the next halving in 2028.

The Bitcoin ETF being underwritten by giants like Blackrock and Fidelity was a watershed moment for the world and it is forcing many who dismissed “crypto’ to go back to the drawing board and ask themselves fundamental questions like:

“Why did Goldman Sachs create a tokenization platform four years ago?”

“How come the JPMorgan ‘coin’ is already settling hundreds of billion of USD in their new blockchain”

“Why are successful countries like Singapore and the UAE super Web3.0 attractive for business”

I would say ‘the penny has just dropped’ for a lot of people.

• Is the state of the traditional crypto space a piece of encouragement for additional blockchain innovation? 

Yes! money talks and gossip walks, the record breaking Bitcoin ETFs with instant billions of dollar flows made institutions and governments sit up. We will even see sovereign nations disclose to the public that BTC is on their balance sheet in 2024.

This encourages blockchain developers to stay on course and helps investors to fund their projects.

I can tell you from personal experience, as a veteran entrepreneur, I’ve built companies making innovative products and it is very hard to keep the faith when you are alone in the early days. But gradually as the smart money and other forward thinkers moved in, it gave me that extra little comfort; “seems like I’m not crazy after all” and I’d stick to my guns.

• What potential Web3 adoption bottlenecks do you believe will need to be solved for adoption to move ahead?

Regulation is the biggest bottleneck, it is natural to lag behind technology but because Web3 touches money, most regulators reacted in a negative way over the years, but gradually as ‘the penny drops’ they are slowly coming onboard. As soon as countries start to align, Web3 will be off to the races again.

Another simple mass adoption test is ”can my granny use it?” Unfortunately granny needs to call her techy grandson and that is another bottleneck.

We’ve a couple of ace cards to play here, Venom blockchain has native account abstraction enabling builders to create more sophisticated layers of abstraction to realize easy to use retail centric user interfaces.

• What other concepts of Web3 are you most excited about going forward?

To tie a bow on what I said earlier, since Venom technology can scale for mass adoption we are finely tuned for stablecoins and the tokenization of real world assets (RWA), ambitious Web3 concepts. Venom's plan is to bring stablecoins and RWA tokenization mainstream in the decades to come.

We wish to impact the lives of regular people and economies who are in need the most. There are countries rich in resources and bogged down with ancient financial structures that exclude them from modern capital markets. We can contribute to making change, that is what I see on the near horizon.

Conclusion 

The blockchain trilemma has always been a constant headache for developers. And while several platforms have come out to throw their hat into the ring, not many have managed to crack the code just yet.  

With the dawn of Web3 upon us, market participants are excited about the prospect of new blockchains attempting to solve this issue.