Why All Cryptocurrencies Are Flawed #money #cryptocurrency




Why All Cryptocurrencies Are Flawed #money #cryptocurrency ▻ Moomoo: Deposit $100 to get up to 10 fractional shares …


16 Comments

  1. Finally: Scalability is a major challenge for blockchains, especially those aiming for widespread adoption. Here's the breakdown:

    The Problem:

    Traditional blockchains, like Bitcoin and Ethereum, struggle to handle a high volume of transactions. This is because every node on the network needs to validate and store all transactions.
    As the number of users and transactions increases, the network can become congested, leading to:
    Slow transaction confirmation times
    High transaction fees
    The Tradeoff:

    There's a concept called the "blockchain trilemma" which suggests it's difficult to achieve all three qualities simultaneously:

    * *Scalability:* Processing a high volume of transactions quickly.
    * *Security:* Maintaining a high level of resistance to attacks.
    * *Decentralization:* Having a distributed network with no single point of control.
    Many blockchains prioritize security and decentralization, leading to limitations in scalability.

    Solutions and Approaches:

    Different consensus mechanisms: Proof-of-stake (PoS) is faster and more efficient than Proof-of-Work (PoW) used in Bitcoin. However, it might introduce some centralization.
    Sharding: Divides the network into shards, where each shard processes a subset of transactions, improving overall throughput.
    Layer-2 solutions: These are built on top of existing blockchains to handle transactions off-chain, reducing the load on the main chain.
    Current State:

    Blockchain scalability is an active area of research and development.
    There's no one-size-fits-all solution, and the best approach depends on the specific use case.
    Some blockchains are implementing these scalability solutions, but it's still early days and their effectiveness in the long term remains to be seen.

  2. Almost nothing is 100% secure, blockchain even if it is very secured considered but there are some way arounds as simple as phishing, although there are also 51% attacks, exchange hacks and smart contract vulnerabilities too.

  3. Decentralisation in cryptocurrency market fell down, because many companies were made on them that act like banks in real world 🤷🏻‍♂️

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