Vitalik Buterin, Ethereum’s inventor, stated the network will scale to Visa levels capacity in just two years on an interview at TechChrunch 2017.
After defining blockchains as “a decentralized system that contains some kind of shared memory.” While smart contracts as “a computer program that directly controls digital assets.” Buterin was asked about a topic which has dominated this space for the past three years, scalability.
We transcribed his response and quote it below in full for the record. Responding to the interviewer stating there was a scaling issue – even to just handle Visa levels let alone every smart contract – that it wasn’t going to work if everyone is running a copy of every program on their computer, Buterin says:
“Yeah, totally. Bitcoin is currently processing a bit less than 3 transactions a second and if it goes close to 4 it’s already at peak capacity. Ethereum, over the last few days, has been doing 5 a second and if it goes above 6, then it’s also at peak capacity.
On the other hand, Uber on average has 12 rides a second, PayPal several hundreds, Visa several thousands, major stock exchanges tens of thousands, and if you want to go up to IoT then you’re talking hundreds of thousands and if you want to go up to non-financial applications – so for example there’s a platform called Leeroy, which is basically just twitter on a blockchain – then we’re talking about hundreds of thousands, possibly millions.
There is a gap from here to there. And right now I think there is institutional hype in this space and just public hype. So when you have Vladimir Putin knowing what blockchains and ethereum are, and Paris Hilton going out promoting ICOs on Twitter, that’s peak hype.
A large part of the reason why a lot of this hasn’t materialized into action yet is precisely because of some of these technical obstacle that make blockchains – you know, work okay for some niche use cases, but not really work...