Ethereum [ETH]’s Sharding and Plasma – Will it improve scalability?

Sharding is the process of splitting or partitioning the database to benefit from the computing power of more than one server. When it comes to the blockchain, especially Ethereum’s, developers spilt the blockchain into parts that would run on different servers. Several hundreds of millions of dollars’ worth of decentralized application and blockchain projects have now been launched using Ethereum’s protocol which is based on ‘smart contracts’.

Ethereum has been adopted by many Fortune 500 conglomerates like Microsoft, JPMorgan, ING, Intel and Banco Bilbao Vizcaya Argentaria [BBVA] to automate certain operations and create decentralized applications on top of the Ethereum protocol. Ethereum was brought to the forefront through the formation of Enterprise Ethereum Alliance and it streamlined its performance altogether.

Vlad Zamfir, a researcher at Ethereum Foundation says:

“I like to spend my time working on blockchain sharding, which I regard as the only true blockchain scaling solution, and which I think will improve the scalabilty of the blockchain without sacrificing the security of the blockchain and the trust model.”

Plasma is a solution released by Ethereum’s co-founder Vitalik Buterin and Bitcoin’s Lightning Network co-author Joseph Poon which scales the Ethereum network by eliminating unnecessary data from transactions and optimizing smart contracts.

They define plasma in a paper titled ‘Plasma: Scalable Autonomous Smart Contracts’ as:

“Plasma is a proposed framework for incentivized and enforced execution of ‘smart contracts’ which is scalable to a significant amount of state updates per second (potentially billions) enabling the blockchain to be able to represent a significant amount of decentralized financial applications worldwide.”

He added:

“In spite of helping in the blockchain, it actually makes it less secure as it makes the censorship much more profitable. These solutions span different trust models and require non-miner/validator nodes to be available to make settlement transactions”

Many experts like Fred Ehrsam, co-founder of Coinbase are of the opinion that such scaling solutions will be the determining factor in improving Ethereum’s capacity to support large-scale decentralized applications. However, Zamfir contradicts by saying that off-chain and second-layer scaling solutions cannot be used as everyone thinks.

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