Ethereum is More Decentralized than Bitcoin
Significantly fewer Ethereum nodes are connected or associated with centralized organizations compared to Bitcoin, according to a study by Cornell Computer Science Professor Emin Gün Sirer. Therefore, more nodes on the Ethereum Blockchain are managed by individuals, instead of institutions or companies. Sirer noted:
“The data shows that the [Ethereum] nodes are both in the latency space, and also geographically more distributed round the world. Ethereum nodes tend to come from all sorts of places, smaller networks, and homegrown entities, as opposed to Bitcoin nodes, which tend to be located in data centres. Our study found that the majority of Bitcoin nodes, 56%, are in data centres.”
One could argue that this is like comparing “apples to oranges”. That’s because the Ethereum network is designed specifically for DApps. Provided that all the upcoming upgrades to its network work as planned, the platform could process thousands of transactions per second. What this means is that DApps as large as Twitter or even Facebook could be implemented using the Ethereum protocol.
Scalability will Take 3 to 5 Years
Ethereum co-founder Vitalik Buterin has stated that his platform will reach full scalablity in the next 3 to 5 years. This, of course, would depend on the successful implementation of Plasma and Sharding scaling algorithms. Briefly, Sharding works by using a proof-of-work algorithm that removes competition between crypto miners. Instead of competing with each other, miners are motivated to work together to solve mathematical problems, which helps save computing power.
Plasma is a solution that is being worked on by various Ethereum developers, which will enable different blockchains on Ethereum to focus on specific tasks, effectively decreasing the workload on the main blockchain. Additionally, there is hardware available such as Intel SGX that will enable crypto-platforms to process thousands of transactions per second, even Bitcoin. SGX can be found on just about all Intel manufactured devices and allows for peer-to-peer zero-confirmation transactions while not burdening the primary blockchain. The Cornell professor stated:
“SGX is a very exciting technology, and there are other trusted computing technologies, not SGX, but by other vendors, that provide similar guarantees. What that gives you is the ability to know what protocol somebody else is following. That is a fundamental leap.”
Moving Operations to Blockchain
Per the professor, a large number of centralized organizations and companies are already moving their operations over to a blockchain, instead of using traditional databases. However, complete transfer of operations to blockchains will likely take several years of extensive development and will require a lot of resources, presumably both financial and human resources. Only then, the professor thinks, will blockchain reach full commercialization.