Who Is Going To Carry All The Traffic? Hive Having A Boring Fork Which Will Bring Benefits

The explosion of DeFi on Ethereum is a lesson of what is coming. We need to be honest here, as exciting as the growth rate is, it is a drop in the bucket. Overall, when we look at the transactions compared to the traditional financial system, this is nothing.

However, we are seeing extreme problems arising from this growth. The Ethereum network is having a tough time handling it. The gas fees have gone through the roof with little indication they will reverse course. It is now to the point where it is worse than things were during the ICO and CryptoKitty phase in 2017.

This was always a concern for Ethereum which is in the process of moving from Proof of Work to a Proof of Stake system. This will, in the developers' minds, help to alleviate the congestion that Ethereum suffered on a few different occasions.

Unfortunately, for that network, it seems that this upgrade is still a bit down the road. Each day, the entire cryptocurrency arena gets more attention, pulling in new participants. Most recently, Wall Street financial institutions are turning to Bitcoin. No longer is it fashionable for those type of companies to shame Bitcoin and cryptocurrency. They have realized that this is a legitimate industry that is not going away.

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So far, the traffic is still slow. Whether we look at gaming, social media, or finance, the numbers simply do not compare. This is a good thing since it shows how big the opportunity is. There are billions of people and hundreds of trillions in transactions just waiting to be presented with a better alternative. Thus far, that presentation has not taken place.

Ethereum is both showing the potential and the drawbacks. One of the reason why many question Bitcoin as a transaction chain is simply the fact that the technology is old. The basis of the network has not changed since it was released more than a decade ago. This is why John McAfee called it "outdated". Being able to only handle a few transactions per second is a problem. At the same time, in the world today, waiting anywhere from 10 minutes to a couple hours for confirmation does not bode well either.

With the renewed interest in cryptocurrency, Ethereum is showing how many networks simply are not ready to make the transition to larger adoption. Even collectively, the PoW chains would have a tough time taking on anything but the smallest sliver of the general financial transactions that occur each day.

Which brings up the main question, who is going to carry all the traffic? As we see things evolve, and assets tokenized around the world, where is all this going to end up?

Certainly, centralized networks want to maintain their control. Also, since they tend to be more efficient, they do have the ability to process a lot in a short period of time. This is something that blockchain needs to get better with.

What is most interesting is that Hive is seeing some of this being put into action. In reading through what is going to take place in the next hard fork, we have to be honest in stating that, from a user perspective, it is a rather uninteresting upgrade. There are not many features being added which will enhance the end user's experience.

Instead, this could be termed an "infrastructure" fork. The main focus is upon how the data is processed and stored. Efficiency is the focus of this upgrade, something that was probably long overdue.

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One of the key benefits to this is to reduce the cost of operating the network. As more data is processed, prices tend to increase. This only makes sense. The money spend by a small company to house its data is nothing compared to what Google lays out each month. Naturally, the amount of data is at two ends of the spectrum, emphasizing the need for efficiency for Google.

Hive is looking at things in a similar manner. While there is not a lot of traffic on the network, being able to handle massive inflows of data is vital. With the problems many other chains are experiencing, now is a good time to position things in such a way.

Infrastructure is boring for most of us. There is no doubt about that. Nevertheless, it is also crucial for all that is to follow. Operating a system based upon technology that is 4 years old is not a wise thing to do. Too many advancements are made in the digital world.

Does anyone really think that Facebook and Google are not continually upgrading their networks, implementing the latest and greatest software possible? This is a no-brainer. Of course they are doing that.

Yet, for most of Hive's (Steem's) existence, it just trudged along using whatever was available in 2016. Over the past few years, a few improvements were made but that was patchwork at best. Now, we are looking at things from the ground up.

Will Hive be the blockchain to handle all the traffic? That is the wrong question. A better way of looking at things is to understand that Hive is being positioned to be able to handle all the traffic it needs to. Wherever the potential growth comes from, that which ends up on Hive will be processed to offer the best user experience without the need for excessive fees.

This could take on much greater importance in the future as blockchain interoperability starts to take hold. Under that scenario, where data can be processed across many chains, we will find those with the ability to handle more traffic becoming increasingly popular. We know that people are unwilling to wait for, well, anything. If a transaction is not processed in a few seconds (at most), we get impatient.

Hive does offer 3 second transaction time. With the infrastructure in place to provide maximum efficiency, we could see this as an attractive option for many applications. Thus, while they are build elsewhere, a percentage of their user base could be directed to Hive to process the transactions. Of course, this will bring greater visibility to this ecosystem, enabling us to showcase the other attributes that we have.

Applications that captures users' attention is what everyone wants. However, this is the second time that Ethereum experienced difficulties. CryptoKittys and DeFi are certainly interesting and garnered a lot of support but it also crushed the entire network.

I bet some wished more attention was paid to how much the network could truly handle.

A network does not need to handle everything yet it should be able to handle what is thrown at it. Hopefully we see Hive positioning itself to do exactly this.

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Posted Using LeoFinance