Transaction speed is one of the milestones in blockchain-based projects. The more transactions are processed per second, the better is the use-case of a cryptocurrency. Hence, Cryptocurrencies buckle down to improve their network scalability.
On this subject, we choose to discuss the upcoming new projects of two of the largest cryptocurrencies by market cap. Bitcoin, the top-one cryptocurrency and Ripple, the third ranking cryptocurrency.
While the cross-border payment network Ripple announced on 27th of March that it is officially working on implementing COBALT algorithm, Lightening labs had launched its beta version lightning network on Bitcoin, on 15th of March.
What does COBALT solve?
COBALT is an algorithm that aims to increase transactions speed to a maximum extent. The algorithm is part of Ripple’s plan and is still under development
Currently, Ripple transaction speed is on average 4 seconds and can process 1500 transactions per second.
Once the implemented COBALT runs, Ripple’s transaction speed would be reduced to 1 second. Hence, it would be three-fourths faster than ongoing speed. Number of transactions per second would increase accordingly.
The new consensus algorithm would allow live transactions. By way of explanation, the transmission procedure would never stop at once but in case of delay it rather slows down.
It is stated by the white paper writers Brad Chase and Ethan MacBrough that the implementation of COBALT algorithm would enhance reliability without global agreement of network participants and it would work in non-uniform trust.
The transition to COBALT algorithm may be the Ripple’s key to a transaction speed dominance over all payments platform.
What does Lightning Network solve?
Bitcoin transaction speed on average is 78 minutes and it is limited to 3 up to 7 transactions per second which is relatively low compared to the top ranking cryptocurrencies.
To tackle the scalability issue, Lightning labs presents Lightning Network.
Lightning Network is a second layer built on top of Bitcoin blockchain that enables faster and cheaper transactions. On a decentralized peer-to-peer ledger, transactions are processed in a new separate payment channel. In other words, a sequence of small transactions between participants are verified off-chain. In the end, only one transaction that records all payments’ balance is sent back to the whole network.
With reference to the website, LN is “Capable of millions to billions of transactions per second”. LN relies on blockchain for security and in cases of disagreement between the participants.
As the project is described to be “scalable off-chain instant payments.”, Lightning Network may prove to be the best solution to cryptocurrencies scalability.
When the update for Bitcoin and Ripple comes out to large-scale users , we can confirm which project provides accurate solution. But at this point we may be only bias to our favourite digital coin or what do you think?