The evolution of the crypto world provides for a gradual development so that it can be defined as complete. The peer-to-peer model has proved to be working in these 10 years, its spread is increasing and cryptocurrencies have become both a focus of study, and attractive to investors.
While some still wonder about the ideals on which the blockchain is based, namely decentralization, being trustless, transparency, security and immutability, others implement it in their businesses and observe the results.
Then there is another category of people who are working to improve the system which poses some limits, these developers address the problems that were not foreseeable 10 years ago.
Here are 3 key points for the evolution of the crypto world:
The feature that differentiates the blockchain from the rest of the existing distributed systems is decentralization.
Progress has been already made to increase the scalability of data centres or cloud infrastructures, achieving good results, but the blockchain model, not being centralized, is a new technology for which solutions are still being studied.
It is not enough to increase the block size to solve the blockchain scalability issue and for many even the LN (Lightning Network) solution seems not to be the most suitable.
We still need time, new ideas and tests before finding the ad hoc solution that solves the scalability problem of the blockchain.
Despite the idea of making the concept of disintermediation concrete for the confirmation of chain transactions through mining, today it seems like a double-edged sword: on the one hand, the hash power is in the hands of a few companies and on the other, the use of hardware such as ASIC, which is certainly more efficient than previous (GPU or FPGA), is also more expensive and consumes a huge amount of energy creating environmental problems.
Both issues, if not resolved quickly, could lead centralized entities to take action.
- Exchange Platforms
There are three types of exchanges in the current situation regarding crypto trading platforms: centralized exchanges, decentralized exchanges (DEX) and atomic swaps.
Exchange platforms are still very centralized and this is a limit because they are vulnerable to attacks by hackers and regulators.
Although they were born as a bridge between the old and the new financial systems, it is necessary, now more than ever, to understand how important decentralization is and why it’s more convenient to choose and rely more on decentralized exchanges – DEX.
DEXs, despite being independent of any private entity, currently use web technology that contains vulnerable parts.
A solution to overcome these limits of DEXs, simply dictated by the dependence of web technology with its vulnerabilities, could be the atomic swap, intended as a decentralized universal protocol for the exchange of cryptocurrencies.