Table of contents
Understanding the blockchain trilemma
Definition: An impossible balance between three priorities
The blockchain trilemma refers to the idea that it is very difficult for a blockchain to simultaneously optimize decentralization , security , and scalability . If a blockchain network chooses to improve one of these characteristics, it will often have to sacrifice one of the others. For example, increasing scalability to process more transactions per second could reduce security or decentralization .
The foundations of the blockchain trilemma: Decentralization, security, and scalability
These three pillars form the backbone of any blockchain project. However, they are often in conflict with each other. Here's a quick definition:
- Decentralization : The network is controlled by many participants, thus avoiding any centralized authority.
- Security : The network is protected against attacks and ensures the integrity of transactions.
- Scalability : The network's ability to process a large number of transactions quickly and efficiently.
Origin of the blockchain trilemma and why it has become an essential concept
blockchain trilemma concept was popularized by Vitalik Buterin , the co-founder of Ethereum . He observed that blockchain developers faced a near-inevitable trade-off between these three priorities. As blockchains become more widely adopted, this trilemma is becoming a key consideration for designing robust systems.
Exploring the three pillars of the blockchain trilemma
Decentralization: Freedom and autonomy for users
Decentralization is one of the founding principles of blockchains. It allows any user to participate in the network without a central authority. Each node in the network plays a role in validating and securing transactions. This prevents censorship and manipulation , two common phenomena in centralized systems. For example, a government can block or manipulate transactions in a centralized system, as has been the case in some countries with restrictions on financial platforms.
In a decentralized system like Bitcoin , where thousands of nodes are spread across the globe, manipulation is virtually impossible. This is why Bitcoin is often considered the most decentralized . In contrast, blockchains like Solana sacrifice some of this decentralization to gain scalability. Solana has chosen to have a limited number of powerful validators, which allows for faster processing of a large number of transactions but reduces node independence.
Security: Protection against attacks
Security is crucial for any blockchain, as it ensures that transactions cannot be altered or falsified. Most blockchains use consensus mechanisms such as Proof Proof of Work Work ( PoW) or Proof of Stake Stake ( PoS) to ensure this security. For example, in the case of Bitcoin , Proof of Work involves miners solving complex mathematical problems to validate transactions, making any attempt at falsification extremely costly.
However, potential vulnerabilities exist, such as the 51% attack , where an attacker controls more than 50% of the network's computing power. In this case, the attacker could reorganize the blockchain and potentially double-spend tokens. That said, the more decentralized a network is, the more difficult it becomes to carry out a 51% attack, as controlling the majority of nodes becomes virtually impossible. Other types of attacks also exist, such as Sybil attacks Denial-of-Service (DoS) attacks, which aim to overwhelm a network and prevent it from functioning correctly.
Scalability: A challenge for blockchain
Scalability refers to a blockchain's ability to process a large number of transactions quickly and efficiently. This challenge is particularly important for enabling the widespread adoption of blockchain technologies. For example, Visa processes an average of 24,000 transactions per second ( TPS ), while Bitcoin processes only 7 TPS. This difference prevents Bitcoin or Ethereum from being used on a large scale for everyday transactions.
Some blockchains, such as Solana and Sui , stand out for their scalability . Solana can process up to 65,000 TPS thanks to its unique consensus model called Proof of History (PoH) , which allows for efficient synchronization of transactions over time. However, this performance comes at the cost of decentralization. By reducing the number of validators and requiring powerful hardware infrastructure to operate (which limits the participation of smaller validators), Solana prioritizes scalability over decentralization.
The trade-offs of the blockchain trilemma in modern blockchains
The compromise between decentralization and scalability
In blockchain systems, the more decentralized a network is, the more difficult it becomes to scale . This is because each transaction must be validated by numerous nodes, which can slow down the entire network. This is particularly evident with Bitcoin , which has chosen to prioritize decentralization and security, but whose scalability is limited. Conversely, Solana has opted for a model with reduced decentralization, allowing it to process thousands of transactions per second, but with greater centralization around specific validators.
The trade-off between security and scalability
Another trade-off concerns scalability and security . To improve scalability, some blockchains may "relax consensus rules." This means reducing the number of nodes that need to validate each transaction or shortening the block validation time. This type of trade-off can make the network more vulnerable to attacks. For example, highly scalable blockchains like Solana or Sui may sacrifice some of their security to process a large number of transactions quickly.
Rollups on Ethereum Layer 2 solution , move computations and transactions off-chain to reduce the load on the main network. While this approach improves scalability, it presents challenges in terms of security and decentralization . By moving computations off the main chain, transaction verification becomes less transparent, which can reduce decentralization and introduce vulnerabilities if Layer 2 protocols are not properly secured.
The compromise between security and decentralization
decentralized network is generally more secure, as an attack would require taking control of the majority of nodes. However, this also means that the more independent nodes there are, the more difficult it can be to ensure that they all adhere to the same consensus rules. Some nodes could slow down validations or be compromised, which could affect the overall security of the network.
This is why some blockchains, such as Ripple or EOS , have chosen to limit decentralization to improve security. By reducing the number of validators, they can better control security, but this raises questions about long-term resilience and resistance to censorship.
Current solutions to overcome the blockchain trilemma
Layer 2 solutions: An answer for scalability
Layer 2 solutions , such as rollups on Ethereum or the Lightning Network on Bitcoin, offer a way to circumvent the blockchain trilemma. These solutions allow transactions to be processed off the main chain, increasing scalability without sacrificing the security of the main network.
Rollups group off-chain transactions and send only a summary of the results to Layer 1, thereby reducing fees and increasing transaction processing times (TPS). However, it is crucial that these systems are properly audited and secured, as vulnerabilities in these layers could compromise the overall security of the network.
Hybrid blockchains: Towards a better balance?
Some blockchains, like Avalanche , adopt hybrid models to try to reconcile scalability , security , and decentralization . Avalanche uses an innovative consensus model where multiple independent subnets process transactions in parallel. Each subnet can operate according to its own rules, introducing modularity into the network. This means that subnets can be configured for different applications, allowing Avalanche to maintain a balance between these three pillars of the trilemma.
Avalanche 's consensus model is based on a proof-of-stake architecture, but with a fast validation process that allows for the processing of thousands of transactions while ensuring sufficient decentralization.
Proof of Stake: A promising alternative
Proof -of-stake (PoS) is increasingly seen as a viable solution to the blockchain trilemma. Unlike proof-of-work, which requires considerable computing power, proof-of-stake allows users to validate transactions based on the amount of tokens they hold. This improves scalability while maintaining a high level of security .
Ethereum , with its transition to proof-of-stake through Ethereum 2.0 , aims to improve scalability while maintaining relatively strong decentralization. However, even after this transition, Ethereum remains relatively slow, with a TPS lower than that offered by blockchains like Solana or Avalanche .
Case studies of blockchains and their choices in the face of the blockchain trilemma
Bitcoin: Security and decentralization above all
Bitcoin has chosen to maximize security and decentralization proof-of-work consensus mechanism . With thousands of nodes distributed worldwide, Bitcoin is extremely decentralized. However, this approach comes at the expense of scalability transactions per second). To address this issue, solutions like the Lightning Network enable micropayments to be processed outside the main blockchain.
Solana : Scalability is the priority, but at what cost?
Solana has chosen to prioritize scalability by using an innovative consensus model called Proof of History (PoH) , which synchronizes transactions very efficiently. This system allows Solana to process up to 65,000 TPS, but at the cost of reduced decentralization . With a limited number of validators and high hardware requirements, Solana is criticized for its reliance on a small number of powerful nodes, which compromises decentralization.
Avalanche : Finding a balance between the three pillars
Avalanche uses a proof-of-stake consensus model with a multi-chain architecture. Each chain is responsible for specific tasks, and subnets can be configured for particular uses, providing modularity that allows Avalanche to better balance the three pillars of the trilemma.
The impact of the blockchain trilemma on the adoption of blockchain technologies
Scalability and mass adoption: The main obstacle
One of the main obstacles to the widespread adoption of blockchains is scalability . If blockchains cannot compete with systems like Visa (24,000 TPS), they will struggle to be adopted on a large scale for everyday payments. Layer 2 solutions like rollups and blockchains like Sui and Toncoin aim to address this challenge.
Security and trust: An essential prerequisite
Without security , user trust in a blockchain can collapse. Bridge , which target the transfer of assets between different blockchains , are a common example of this vulnerability. These bridges are frequently targeted, jeopardizing user funds.
The future of the blockchain trilemma
Upcoming innovations to solve the blockchain trilemma
The blockchain trilemma will continue to be a challenge, but innovations like sharding , which divides a blockchain into fragments to process transactions in parallel, offer promising avenues. Up-and-coming blockchains such as Solana , Toncoin , Near , Sui , and Aptos offer innovative approaches to improve scalability while preserving security and decentralization.
FAQ
What is the blockchain trilemma? It is a concept that states that a blockchain cannot simultaneously maximize scalability , security , and decentralization without compromising on one or more of these aspects.
How does a 51% attack work? A 51% attack occurs when an attacker gains control of more than half of a network's computing power (or tokens), allowing them to alter transactions or spend the same funds twice.
What compromises has Solana ? Solana has chosen to prioritize scalability by reducing the number of validators and requiring powerful hardware infrastructures, which limits decentralization .
Which Layer 2 solutions improve scalability without compromising security? Rollups and the Lightning Network - chain transactions to be processed while maintaining the security of the main network.
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Yoann
Training engineer, I quickly became interested in the field of finance. Convinced that decentralized finance has a bright future ahead of it, I participate in its democratization by developing Crypternon.
