Blockchain scalability trade-offs (woj.eth, founder of Mazury)

Okay.

And the third?

The third one, I think it's in general about blockchain scalability as such. So for trustless money purpose, as you mentioned before, we want to have a trustless system that cannot be stopped, that is decentralized, and you are sovereign in this system. And we have Bitcoin for that. Ethereum-based layer is also very well decentralized and operated by many different people and organizations, but it's costly to run these algorithms in the decentralized ways where many people can contribute to these networks. It's just the network will be slow, probably it will not have much throughput. And because it doesn't have much throughput, if you want to submit some transaction, or you want to change this database, you will just pay a lot of so-called gas fees.

Right.

And you've heard about them. You paid probably too much in the bull run for some transactions that didn't do anything special. And this is normal. This is supply and demand laws in action. And always this financial application will be will have more value per one change than just you posting a post on Facebook or you getting a diploma after finishing a course, something that you just collect. And blockchain scalability comes— here comes blockchain scalability of what trade-offs can we do about the trust assumptions and decentralization? So it still holds some credible neutrality, but at the same time, it's cheap to use. Everybody can just interact with blockchains for free or for some very cheap price. And yeah, finding this balance is hard. Many, many, many great teams are working on building blockchains which are less decentralized, like Solana or Polygon, or are working on scaling solutions for Ethereum, like rollups.

Mm-hmm.

Optimism, Arbitrum, ZK rollups and such. And right now I would say there's no clear winner in this path. It's going to emerge in a few years. Actually, the seed phrase thing, very much unsolved. The privacy thing, potentially dangerous. About scalability, I don't worry. It's just going to be—

Okay.

Somebody will crack it. But in the current form, it's definitely, everything is too slow and too expensive to use. So I would say these 3 areas is why right now your Ethereum identity will not be as important or more important than the government one. But again, we're working on it.

Interesting. I like that. And do you think there are some trade-offs for the 3rd one? What are we waiting for? Because as you were saying, you're like, yeah, we have more centralized systems like Solana that allow more scalability on some sort.

Less centralized.

But less centralized. No, more centralized. Sorry.

More centralized. More centralized.

And so I'm like, okay, what is the trade-off that you think is going to win or survive? What are you willing to give up?

That's a good question. So for Mazure, for example, we issue our— so we have our own set of badges on Mazure that you can collect. And we issue them on Polygon. So we made an opinionated decision that we don't need that much of decentralization for this concrete use case. And I feel like there will be better and better solutions, scalability solutions. They will be maybe more decentralized over time and they will be more performant over time. But it's going to come down also for developer. What do you need for your use case? Maybe you just need an API that even could be controlled by Google or Facebook, but you have some assurance that they will always keep it open and you'll always be able to building on them. And I think this is the agreement, there's no contracts, but this is a promise that Solana or Polygon give you. is that, okay, we provide you with our server infrastructure, but in our business model or our idea is that it's always going to be open and permissionless to build on and you can trust us. It's trusted, but in theory it's going to work. You shouldn't trust probably these systems with your money. Or whenever a government comes and they say that, oh, you cannot transact right now on this blockchain, companies like Solana or Polygon will probably just ban your address at some point of time. And it's happened with, for example, Tornado Cash recently, and it's more to come probably in the next years. And for these situations, you probably only want to transact with Bitcoin or Ethereum. But for small social applications like ours, Polygon and Solana are probably fine.

Got it. Okay, cool. Well, that's your trade-off. I think everybody's going to have— well, it depends. It depends on the future. But do you think people will be able to choose their trade-off or do you think it's going to be a sort of, yeah, that's just how it is. We gave up on trust.

No, in ideal worlds, there is So I'm very much aligned with the Ethereum scalability roadmap of essentially doing a lot of technological magic around rollups and sharding to have minimum trust assumptions and huge throughput. And we're not going to get into the details, but there is a world where we have this decentralized architecture on scale. But before we have that, the trade-off I guess we're gonna be on the developers who build applications that are valuable to the users, more from first principles. We deliver some value to you and you shouldn't care if it's on blockchain or something like that. We just are valuable. But we used it on— we built it on this infrastructure because it allows us to do cool shit. Maybe it's easier for transferring money or maybe we can read your credentials from chain. And this is our case. We couldn't build Mazure without decentralized infrastructure. And yeah, when we deliver this unique value proposition to the users, we can choose what database and what blockchain do we want to build on. And yeah, it's going to be on the developers. And users are like, yeah, this app, I like this app and it has good tech assumptions. I'm going to use it.

I like that.