2019 could be an exciting year for blockchain development as lots of projects mature and focus on interoperability.
The recent drop in cryptocurrency prices might be discouraging to some traders, but those who are passionate about the underlying technology of the blockchain are more excited than ever. Several networks are now competing to be the go-to foundation for new dApps and business developments.
Ethereum to Address Scalability Challenge
The Ethereum blockchain is already widely used. There are several hundredcryptocurrencies based on it already and over 2,000 dApps built on its infrastructure. However, Ethereum was one of the first blockchains. As a “first entrant” to the market, it needs to continually evolve to address issues like interoperability and privacy concerns that newer chains able to take into account in the initial development stages.
Hence, Ethereum is now working to address issues of scalability and the functionality of smart contracts.
The forthcoming Constantinople update will improve Ethereum’s efficiency, reduce block rewards for miners, and make the blockchain more resistant to ASIC miners.
The efficiency improvements will speed up the blockchain and let dApps function faster. The way smart contracts are stored on Ethereum will also be changed to make smart contract development cheaper and more accessible.
The update will make the Ethereum blockchain easier to mine, which will reduce block rewards for miners because successfully mining a block will become more frequent.
Lastly, it responds to the problem of new ASIC miners pricing out smaller miners since the update will help prevent larger pools from mining more Ethereum and having too much power over its blockchain.
Recently, Ethereum’s core development team decided to postpone the full implementation of Constantinople until January 2019 to give time for more development and testing.
There is a second update planned for Ethereum in 2019. Known as Ethereum 2.0, it will include the Casper upgrade and add sharding to the blockchain.
The Casper update will change Ethereum from a proof of work (PoW)blockchain to a proof of stake (PoS) mechanism. PoS works on a principle of a stake in the blockchain through token or coin ownership. Participants can stake their coins or tokens to help govern the blockchain. PoS improves decentralization and removes the threat of large cryptocurrency mining operations controlling a blockchain.
By adding sharding, the Ethereum blockchain will be able to improve scalability (i.e. increase the number and speed of transactions). This will make it possible to host more dApps and use-cases.
Hyperledger to Create a Commercial Blockchain
Hyperledger is an open-source, non-profit project created initially by The Linux Foundation. It is now working with collaborators like IBM and Intel to build platforms with a commercial and financial application. As of now, Hyperledger has ten blockchain software options with applications in many industries. Over 700 code developers from over 150 organizations have helped to develop Hyperledger’s blockchain technology stack.
Like other smart contract platforms, Hyperledger is working on issues of privacy, scalability, and interoperability. In regards to interoperability, it is working with Ethereum and the Enterprise Ethereum Alliance (EEA). Both organizations hope developers share their open-source projects for the greater good of blockchain development.
2019 will see Hyperledger and Ethereum working together to develop the interoperability of their respective blockchains.
Cardano to Add Use Cases
Cardano’s highly anticipated “Shelley” blockchain mainnet is expected to go live in 2019. Cardano is hoping to deliver advanced smart contract functionality, enabling businesses and other entities to do more with the Cardano blockchain than they can with other options, like Ethereum. The Cardano blockchain will also be PoS from the outset.
For blockchains, transactions are not just financial exchanges. Smart contracts make it possible to exchange and update any type of qualitative and quantitative information. For example, if Twitter was a dApp, every tweet or comment would be a “transaction.”
Cardano’s goals have always been to solve issues of scalability and decentralization faced by existing blockchains. The hope is that “Shelley” to deliver a business-ready blockchain that can cope with high transactional demand.
OmiseGo to Serve the Unbanked
OmiseGo’s goal is to bring financial services to the two billion people in the world who do not have a bank account. This population is known as the “unbanked” and mostly live in low and middle-income countries (also known as emerging markets). These are people without access to savings or credit who cannot participate in the mainstream global economy.
OmiseGo is planning to serve the unbanked with its cryptocurrency and payments services. In particular, it plans to allow peer-to-peer transactions of cryptocurrencies and fiat currency and create a scalable decentralized currency exchange.
The next step for OmiseGo, which could well happen in 2019, is to develop a network able to support the same high number of transactions as existing services offered by banks, Paypal, Swift, etc.. The “Tengen” milestone on OmiseGo’s roadmap is to create an exchange that is decentralized and interoperable with different blockchains.
Polkadot to Advance Data Sovereignty
The Polkadot blockchain is aiming to become the foundation of “Web 3.0” — the so-called decentralized internet — through building a fully interoperable blockchain upon which organizations can run their chains simultaneously with the Polkadot chain. According to the roadmap, developers and businesses will be able to build on Polkadot blockchain after its launch in 2019.
The decentralized internet could deliver applications and platforms which are no longer controlled by big corporations like Facebook, and lets users control their data. Polkadot’s interoperability will let different blockchains, platforms, and dApps communicate with each other more efficiently than the vertical blockchains that exist today.
2019 is the Year of Interoperability and Scalability
The developments discussed above are only a few examples of the direction blockchain is moving as various protects starts to reach maturity. 2019 will hopefully see more blockchain projects turn into real-world applications. To achieve this, however, blockchain projects must address the underlying problems of scalability and interoperability. Only once these have been overcome will blockchain technology indeed threaten to displace traditional platforms and payments models.
Author: Mina Down