Vitalik Buterin, co-founder of Ethereum, coined the term The Blockchain Trilemma sharing 3 issues developers face when building in the space. They are —

Decentralization + Security + Scalability

Most blockchain networks prioritize 2 of the 3, but no network has fully addressed all of them.

When a technology allows for all three simultaneously, the trilemma may be solved.

Solving the trilemma could lead to mass adoption and functionality of crypto technology. 

Today we’ll share a breakdown of the terms and how blockchains are working to solve these pain points: 

Decentralization

Rather than controlled by a single entity, blockchains distribute power to all network participants. 

Security 

Blockchains need to be immune to nefarious attacks. 

If a hacker can control more than half of the network, they may manipulate transactions, altering the blockchain. This is referred to as a 51% attack. 

Scalability 

Blockchain networks need to support a large number of transactions and users without increasing fees and transaction times. 

Ethereum is renowned for its high gas fees thus pricing out potential participants. 

Solving the Trilemma

No blockchain has solved the trilemma, however, solutions are being built to address the issues.

The Lightning Network looks to solve Bitcoin’s scalability issues. 

Polkadot Parachains may solve the trilemma, creating a playing field in which everyone can win.

Polygon is a stack of protocols designed to fix Ethereum’s scalability issues.

What is Solana’s solution to the blockchain trilemma?

This is the tenth installment in The Osprey Crypto Made Simple Series where we describe a concept clearly and concisely. If there’s something you would like us to define, please reply to this Newsletter email or, if you are reading this on the web, hit us directly at riley@ospreyfunds.io.