A look at the headlines of recent times might give you a familiar conclusion – with all the ups and downs of the market, it’s too early to take encryption seriously.
And it’s true, despite the best efforts of the industry’s most notable developers, the world’s largest cryptocurrency remains not only volatile, but difficult (and risky) to use, at least in a way that their creators want. ]
Still, in 2018, fans around the world are working hard on improvements.
As such, there is optimism, the advances could begin to become more complex, creating a user experience that finally begins to transcend the problems – namely the high fees and the long delays in the process. wait – which users of most blockchains are used to.
In fact, over the next year, blockchain users could see exciting new features and early scientists who could help the industry get closer to this vision:
1. Chains off chain
And if it was possible that blockchain-based transactions avoid using the blockchain?
That’s the big idea behind blockchain payment channels, an idea that dates back to 2015, but whose time may have finally come this year. Most often associated with the Bitcoin Lightning Network, the idea is actually more general than this specific instance.
Essentially, blockchain payment channels allowed two people using a single cryptocurrency to send small payments, settling for blockchain (and managing high fees and transaction times) only when it was absolutely necessary.
Due to the potential impact, the idea is catchy – the ethereum developers, although they often do not see their bitcoin peers, are working on the same type of solution.
But there is more than just a rivalry involved, there is also reason to believe that 2018 might be different in that real live transactions could be sent in significant numbers.
Developers behind Bitcoin’s Lightning Network said the technology was almost ready based on successful tests. Meanwhile, the ethereum developers have also unveiled successful tests for their versions of the concept, Raiden Network, with a more ambitious version, Plasma, potentially around the corner.
2. Live staking
As their popularity grows, attention is also given to the electricity needed to support cryptocurrencies.
Although the relevant data is difficult to pin down, work proof, the consensus protocol underlying bitcoin extraction, is better defined as a greedy energy process. As such, there are concerns about its use of electricity that could have large scale environmental effects.
This leads to further research on an idea of 2011. Called proof of wagering, or “consensus by vote”, the idea was implemented, however, not on the scale desired by ethereum .
As such, his long-awaited project, Casper, should be the subject of close scrutiny this year, and early versions are starting to emerge.
In a New Year’s testnet, a variant of Casper was supposed to be functional. Karl Floersch, a leading developer behind technology, told CoinDesk at the time that the code works with “no hiccups.”
There is still work to be done to adapt this first version of Casper to the different ethereum clients, but the ethereum creator, Vitalik Buterin, has stated that he is expecting to the technology is tested alongside proof of work in the future.
3. Confidentiality advances
Confidentiality has been a somewhat neglected promise in the majority of blockchains, but it is nevertheless a problem that could improve this year.
Most notable is the progress in zero-proof evidence, what Buterin called “the most under-publicized thing of cryptography at the moment”, becoming cheaper and easier to deploy.
A form of cryptography that hides information without risking validity, it has already been slightly adapted to the ethereum, which could lead to a wave of startups that are experimenting privately with smart contracts in new ways and unexpectedly.
Moreover, in a white paper published earlier this month, a system for achieving zero knowledge without compromising trust – a point of contention in some earlier versions of technology – was published, an update that could have exciting consequences. ]
And as existing technologies mature, privacy cryptocurrencies, such as monero and zcash, should also improve.
In preparation for an upgrade, zcash has consistently beefed up its security, while Monero is gearing up to introduce “bulletproofs”, a feature that could reduce fees by 80%.
4. Decentralized exchanges
No, this is not just a new version of Coinbase or Kraken.
While the largest industry exchanges are struggling to cope with the influx of new adopters, a growing number of projects are at work to develop what we’ve been doing. calls for a decentralized exchange. The term refers not only to a new browser-based exchange, but rather to a type of software that users can use to exchange one cryptocurrency with another without a central entity.
The year 2017 was marked by a flood of new decentralized exchange projects, such as ShapeShift’s Prism, 0x, OmiseGo, Kyber Network and many others.
Expect these efforts to accelerate this year.
Up to now, the Ledger hardware portfolio has already been integrated with the decentralized radar relay, allowing users to exchange tokens with confidence from the ethereum.
Although the functionality is limited (it is only supported by a single wallet and only ethereum-based tokens can be sent), many see in the future a glimpse into the future of cryptocurrency exchanges.
Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an interest in Coinbase, Kraken and Lightning Labs.
Mainframe computer via Shutterstock