Element #1: Scalability



Transactions per second/ Throughput

Network.

Data Scaling.

#1 Throughput



The miners solve cryptographic puzzles to “mine” a block in order to add to the blockchain.

This process requires an immense amount of energy and computational usage. The puzzles have been designed in a way which makes it hard and taxing on the system.

When a miner solves the puzzle, they present their block to the network for verification.

Verifying whether the block belongs to the chain or not is an extremely simple process.

The problem with proof of work.

First and foremost, proof of work is an extremely inefficient process because of the sheer amount of power and energy that it eats up.

People and organizations that can afford faster and more powerful ASICs usually have a better chance of mining than the others.

As a result of this, bitcoin isn’t as decentralized as it wants to be. Let’s check the hashratedistribution graph: Image Credit: Blockchain.info

Theoretically speaking, these big mining pools can simply team up with each other and launch a 51% on the bitcoin network.

What is proof of stake?

The validators will have to lock up some of their coins as stake.

After that, they will start validating the blocks. Meaning, when they discover a block which they think can be added to the chain, they will validate it by placing a bet on it.

If the block gets appended, then the validators will get a reward proportionate to their bets.

Cardano: Ouroboros Underneath the Hood

Commitment Phase.

Reveal Phase

Recovery Phase.

Commitment Phase

