The Development of Public Blockchains in 2024
A blockchain is a decentralized ledger of transactions stored sequentially and secured cryptographically in immutable blocks. Blockchains are broadly classified into two; Public Blockchains and Private Blockchains. A public blockchain is simply defined as a blockchain that is open to everyone. The details of the transactions including the addresses involved, the amount, the timestamps and address balances are visible via a blockchain explorer which is a copy of a blockchain ledger. A private blockchain is a type of blockchain where access to the network and participation in the consensus process are restricted to a specific group of entities.
In this article, we will focus on public blockchains, examining their current state, which includes an overview of existing blockchains and the key limitations faced by them. We will also discuss the technological advancements of public blockchains, specifically the CoinEx Smartchain public blockchain, and conclude the article with an encouraging outlook for the continuous growth and maturation of public blockchains in 2024.
Current State of Public Blockchains
The term “Blockchain” originated with the launch of the Bitcoin protocol, where the way transactions are stored in blocks coined the term. The Bitcoin blockchain is the first public blockchain, launched in 2008. Blockchains have evolved as other blockchain networks attempted to address the limitations of the technology, incorporating additional functionalities such as smart contracts and blockchain interoperability.
The current state of public blockchains presents both innovative potential and ongoing challenges. The first generation of blockchains, including Bitcoin, Proof of Work (PoW) Ethereum, and forks of Bitcoin like Litecoin, Bitcoin Cash, etc., faced the issue of a lack of interoperability, hindering the exchange of value and information among them and off-chain (internet). This is no longer a problem, as bridges have been constructed to facilitate interoperability, and layer-2 blockchains are now built on older blockchains to scale up transactions and enable interoperability.
Public blockchains face challenges, but innovation and research are addressing them. Scalability limitations are a key hurdle for older Layer 1 blockchain like Ethereum, Bitcoin, and Litecoin, causing network congestion, high fees, and delayed transactions. While Layer 2 solutions effectively offload transactions, rising adoption continues to stress the base layer. Fully fixing congestion without trade-offs might be unlikely, but significant progress is being made.
Directly modifying core Layer 1 protocols like block size or generation time to fix the scalability issue without consensus often leads to forks, which can be disruptive. However, alternative approaches like sharding and rollups show promise for scaling without major protocol changes. The future of scalability involves continuous research and development. While challenges remain, ongoing efforts are improving transaction capacity and efficiency in public blockchains.
Technological Advancements
Several technological innovations are shaping public blockchains. Some of the innovations include smart contracts, decentralized autonomous organizations (DAOs), decentralized applications (dApps), layer-2 and layer-3 solutions, a network of public blockchains like Cosmos, and zero-knowledge blockchains for enhanced privacy.
● Smart contracts: Smart contracts are self-executing agreements that function on the blockchain.
● Decentralized Autonomous Organizations (DAOs): DAOs are community-governed entities that are facilitated by blockchain rules.
● Decentralized Applications (DApps): DApps are applications built on blockchains.
● Layer-2 Solutions: These are side-chain solutions designed to solve scalability limitations and lack of interoperability inherent to early blockchain designs.
● Network of Blockchains: Interoperable blockchain networks like Cosmos enable communication and collaboration between different blockchains.
● Zero-knowledge blockchains: ZK blockchains feature enhanced privacy by masking transaction data and addresses.
These innovations are shaping the future of public blockchains, unlocking new possibilities for trust, collaboration, and data security.
With the evolution of public blockchains, the issue of scalability is addressed through innovations such as blockchain sharding, rollups, layer 2 sidechains, and new consensus mechanisms, among several others. Blockchain sharding is a technique that partitions the blockchain network into smaller subsets known as shards to increase transaction speed and scalability. Blockchain rollups are a layer-2 scaling solution that aggregates multiple transactions off-chain before settling them on the main blockchain, thereby increasing scalability and reducing costs. Layer-2 solutions are blockchains also known as side chains built on Layer-1 blockchains to assist in processing transactions. There are new consensus mechanisms that have been developed to solve the issue of scalability, which include Proof-of-Authority (PoA), Delegated Proof-of-Stake (DPoS), etc.
Another technological advancement resulting from the evolution of public blockchains is security. While security hasn’t been an inherent issue in blockchain design, there have been hacks stemming from private key leaks, website phishing, and smart contract vulnerabilities. Now, several blockchain companies focus on auditing smart contracts, such as Certik, and provide software to mitigate phishing attacks. Multi-sig wallets, which require more than one private key to perform transactions, offer enhanced security and are commonly utilized by large organizations for facilitating payments. Additionally, centralized exchange hot wallets like CoinEx also employ multi-sig wallets for added security.
Another important technological advancement resulting from the evolution of public blockchains is Interoperability. Layer-2 blockchains and the latest generation of blockchains allow interoperability of blockchains; tokens and data can be sent across blockchains. Data can also be sent from off-chain (Internet) to on-chain (blockchain) and vice versa using protocols like blockchain oracles. All these technological advancements make blockchain more robust and efficient for decentralized finance.
CoinEx Smartchain
CoinEx Smart Chain (CSC) is a decentralized public layer-1 blockchain that employs the Proof-of-Stake consensus to feature transaction speed, low fees, scalability and interoperability with other blockchains. CoinEx Smart Chain is unique amongst other blockchain platforms, it integrates seamlessly with the Ethereum blockchain, facilitating the development and migration of smart contracts and decentralized applications (DApp) via the Ethereum Virtual Machine (EVM).
CoinEx Smart Chain also features decentralized governance using its native token CET (CoinEx Token) to power the blockchain. CET holders can earn rewards by staking CET tokens, contributing to network security and consensus mechanisms through staked nodes.
CoinEx Smart Chain Features
1. Full EVM compatibility: Decentralized applications and Smart contracts (DApps) on Ethereum can be directly migrated to the CoinEx Smart Contract (CSC).
2. Permissionless and decentralized: Supporting up to 101 nodes based on the ranking of staked CET.
3. High performance with Low Fees: Block generating in seconds with extremely low transaction fees.
4. Cross-Chain Bridge: The Cross-Chain Bridge enables secure asset exchange between CSC Mainnet and other compatible blockchains, enhancing liquidity and accessibility within the ecosystem.
2024 Outlook for the continuous growth of Public Blockchains
In 2024, public blockchains continue to grow and evolve. Technological advancements like blockchain sharding, rollups, layer-2 solutions and zero-knowledge blockchains are enhancing scalability, privacy and interoperability while innovations in security, and decentralized governance are increasing trust and efficiency. With ongoing development and adoption, public blockchains are set for a promising future.
