Lightning, Plasma, Raiden, and State Channels

Cybersecurity, Privacy, Risk Management, Cryptocurrencies, Fintech, Information Technology

Blockchains suffer from scaling issues. This is due to the fact that every transaction has to be propagated to all the nodes in the network and after propagation is complete the mining activity to create a block and provide a confirmation. In bitcoin blockchain a confirmation can take about ten minutes. When it comes to the security of a blockchain the number of nodes is directly related to the security of the blockchain, more nodes mean better security. Whereas the performance is indirectly proportional whereby as the number of nodes increases the blockchain starts to slow down as the transactions need to be propagated to more nodes. Transactions Per Second (TPS) for some blockchains are: • Bitcoin Blockchain processes 7 TPS • Ethereum processes 13TPS • Ripple processes 1500 TPS • Visa processes 1700 TPS, if required the system can process up to 56000 TPS