You want to get from A to B. You can buy an expensive ticket and travel for an hour, or buy a cheaper one and be there in 2 minutes. People behave rationally and most will choose the more affordable and faster option. Therefore, they will never be willing to pay for expensive transactions on the blockchain.
Public and decentralized blockchain networks usually need to scale better. This means they are unable to process all incoming user transactions in a timely manner. Think of it like a bus that runs regularly every 10 minutes from a stop. Only 100 people can fit on the bus, but there are regularly 200 or even 300 people at the bus stop. People need to take the bus, so they start offering a higher fare. Some people are still willing to pay The fare rises from 0.50 USD to 50 USD. The competition will emerge. A modern high-speed train that runs every 30 seconds, the fare is only 0.10 USD, and it can fit 1,000 people. In a week, no one will use the bus.
In blockchain terminology, we would say that a high-speed train scales better than a bus. The number of transactions handled by a system per second is referred to as throughput. Think of it as the number of people the bus takes every second. In our case, it is 0.16 people, because we divide 100 people by 600 seconds.
Cardano has ambitions to become a global financial and social operating system. To do this, it needs to scale better. Much better. In this article, we discuss why it is difficult to achieve scalability at the first layer and why we need second layers. We’ll talk a little bit about Hydra, a bit about rollups, and a bit about Milkomeda.
Remember that a single Cardano transaction can contain multiple assets and multiple recipients. We won’t repeat this too much in the article, but a single Cardano transaction can be the same as 10 or even 100 transactions on another blockchain network.
TLDR
Worldwide, over 16,000 digital financial transactions take place per second. It is difficult for decentralized blockchains to approach such high throughput. State channels, sidechains, and rollups are all second layers that we will be using in the Cardano ecosystem in the near future.
This article was prepared by Cardanians with support from Cexplorer.
Read the article: https://cexplorer.io/article/scalability-as-cardano-s-path-to-global-adoption