February 28, 2022
The Next Generation of Blockchain Technology
Hi! I’m Jack O’Holleran, co-founder of the SKALE Network. We are at an exciting time in the history of blockchain technology and Web3 adoption. Until recently Blockchains have been slow, expensive, and difficult to use which in turn creates a rocky experience for people who’ve tried to use it. That’s changing rapidly as the technology improves and newer blockchain projects, like SKALE, are leapfrogging old approaches. SKALE was designed to fix poor User Experience by creating a fast, easy, and, most importantly, free end-user experience. Best of all, behind this is an unlimited number of connected SKALE Blockchains making growth limitless.
To better understand this giant step forward, we need to first look back at the history of blockchain technology.
Blockchain enables new business models for decentralizing and democratizing businesses, giving power back to consumers. It all started with a simple idea - digital money that no one person or small group of people controls. The first major success in this category was bitcoin, which is ground breaking and future proof, despite its simple approach.
Bitcoin also opened the door for the next generation of innovation, which was decentralized computation. Instead of just verifying and recording transactions, decentralized computation allows applications to run on the blockchain, significantly multiplying the use cases far beyond digital money. Ethereum was the first major launch of this technology, allowing applications across DeFi, gaming, and Web3 to run right on the blockchain.
Ethereum, while secure and novel, was unfortunately also slow and expensive once it had too many users. These shortcomings brought in the era of, “Ethereum killers”, which aimed to capitalize on the promise of Ethereum. While these new technology advances have enabled a whole host of decentralized applications, there are still significant cost, speed, and usability issues which are holding back mass consumer adoption.
In short, blockchain technology was improved by the monolithic layer 1 “ETH Killers”, but they still face scaling and usability challenges. Overcoming these problems is going to require more than creating a faster consensus.
SKALE looked at these issues and realized that in order to overcome them, it needed to leapfrog earlier approaches, so it created the first Ethereum based EVM multichain network. Like the ETH killers, SKALE has a very fast and novel consensus algorithm, but its most prized innovation is the network architecture. This can be split into three primary innovations:
1. SKALE is the FIRST blockchain network built alongside Ethereum.
Half of the SKALE Network runs on Ethereum based machines and the other half runs on SKALE based machines. This design takes advantage of Ethereum’s security and marries it to the Speed advantages of SKALE. It receives value from Ethereum and also delivers value in terms of fees and functionality to Ethereum, which creates a strong bond with the Ethereum community by paying fees into the network, not just taking traffic away.
2. SKALE is the FIRST Ethereum Multichain blockchain network.
That means SKALE is made up of many blockchains, not just one single monolithic blockchain, with each application getting its own private SKALE chain. The magic of this design is that speed, agility, and capacity are all gained without compromising security. Each chain added to the network creates more capacity while still pooling security with all of the other chains.
3. SKALE has the ability to grow exponentially to meet demand.
As demand for more chains increases and the network gets overloaded, it effectively goes into “surge pricing” which makes new chains more expensive. This incentivizes validator operators to set up more nodes (to meet the demand), which increases supply and then decreases the price.
Imagine we are talking about traffic and not blockchains. In this analogy, Ethereum is a major crowded interstate freeway without the ability to increase the number of lanes. The ETH Killers are new highways with better concrete and a few more lanes… but they are still capped in how many lanes they can have. SKALE in this example would be not one highway with optimized concrete but one lane for every application, where the cars can drive as fast as they want without any traffic but their own. There could be hundreds of thousands of lanes at some point. SKALE’s ability to create new lanes gives it unrivaled capacity and throughput.
SKALE is at a very exciting time in the history of the network with numerous lanes existing. Currently, there are now 6 EVM blockchains live in the SKALE ecosystem with more coming with each new dapp joining. Next month SKALE version 2 (also known as the SKALEVerse) launches. In the new version, we add the concept of a connected universe of blockchains where SKALE Hubs and dApp Chains can all communicate and bridge together in real time. You can read more on that release here.
SKALE’s Innovator Program already has over 100 applications signed up, all at different stages of finalizing their builds in preparation for the V2 launch. The next stage of blockchain computing technology is here, SKALE Network plans on bringing Ethereum and blockchain to the next 1 billion consumers globally.