Upcoming research from Arizona State University (ASU) shows that the Dash network can scale on-chain to over half of PayPal’s current transaction levels with ease.
The soon-to-be-released research paper, titled Block Propagation Applied to Nakamoto Networks, explores the viability of scaling the Dash network to mass levels on-chain primarily through increasing the block size. The paper specifically explores propagation techniques to minimize the orphan rate at high levels:
“We found that xthin block propagation can support the Dash network with a capacity at least an order of magnitude larger than the original Dash protocol.
We expect that compact blocks can also support this capacity. However, compact blocks seem to not work as well at larger block sizes. We also found that traditional block propagation ran into two limits at scale. One limit involving economic considerations of miners and another limit where the network became unstable.”
The research concluded that Dash can easily scale to 10mb blocks with only a 0.1% orphan rate. Dash’s block interval is 2.5 minutes, compared to Bitcoin’s 10, making this block size roughly equivalent to a 40mb block size for Bitcoin. According to the paper’s co-author Dr. Darren Tapp, this would increase Dash’s capacity to rival major global payment networks:
“10MB blocks would be able to process around 120 tx/sec. This is just over half of what PayPal processes on average.”
The Bitcoin network currently processes around 2.3 transactions per second, while Ethereum processes around 8.7. The Dash network is currently well below capacity at around one transaction per five seconds.
Paper validates on-chain scaling, shows Dash can scale to mass payment network levels
The ASU paper on Dash block propagation shows the long-term viability of an on-chain scaling approach to growing payment networks. Based on this research and preliminary investigations into future research, Dr. Tapp feels optimistic about Dash’s ability to effectively scale well beyond the 10mb block sizes researched:
“I’m very optimistic. This research is just one small part in the whole body of what’s known. Peter Rizun and Andrew Stone have shown that xthin propagation can support much larger blocks. Also, Brian Levine, and George Bissias are showing great progress with graphene block propagation. If some software optimizations are thrown in I feel Dash can support much more with out a major hardware upgrade. Of course, Dash’s ace up their sleeve is that if hardware upgrades are ever needed, the resources will be available for Dash.”
Dr. Tapp believes that, long-term, on-chain scaling is a viable solution for a global payments network such as what Dash aspires to be, possibly more so than alternative scaling methods:
“Yes, I do believe that on-chain scaling is a viable solution. I believe that over the next few years we will find that on-chain scaling is more viable than other scaling techniques being explored.”
Dash vs. Bitcoin’s Lightning network
To address scaling issues facing the Bitcoin network without implementing on-chain scaling solutions, the prime off-chain solution explored has been the Lightning network, a web of off-chain payment channels that conduct regular transactions off-chain while occasionally settling on-chain. Dr. Tapp sees this as an inferior solution to the on-chain scaling approach Dash is pursuing:
“The genius of the original Bitcoin model is that in runs at a stable Nash equilibrium. The introduction of punishment transactions on the lighting network is clear evidence of a step away from this stable Nash equilibrium. I’m grateful that Dash is funding research exploring what transaction throughput can be supported without disturbing the original equilibrium.
I expect that on-chain scaling combined with SPV wallets being pursued by Dash and others will provide simpler and more secure payment solutions overall when compared to the lightning network.”
The Lightning network is in use on the Bitcoin network, but at present has not yet gained wide use. In current implementations, it contains several important drawbacks when compared with on-chain transactions, including security and routing issues.
Academic research as a key component of Dash’s future growth
The majority of academic research on blockchain networks has been on the specific subject of Bitcoin, from which other similar cryptocurrencies have drawn their own conclusions. Dr. Tapp feels that it is important to have this type of research done specifically for certain cryptocurrencies such as Dash, rather than simply apply Bitcoin-specific research:
“I do believe it’s important. If Peter Rizun says that Bitcoin Cash can support 1GB block every ten minutes, then me may naïvely assume that Dash can support 250MB blocks every two and a half minutes. However, I would like to test this naïve assumption before taking it to production. I would not be surprised if processing a smaller block more often would allow for a greater transaction throughput.”
The paper’s co-author Nakul Chawla similarly believes that Dash needs dedicated research if it is ever to be widely trusted as a global payments network by businesses and users around the world:
“I think it wouldn’t be advisable to build a global payment network without knowing what the saturation limits are. Ideas that look good in theory need to be tested experimentally in order to prove their potential. We have done a similar research, where we took the two technologies that most networks might adopt later and put them against each other for a stress test.
Consumers using a particular technology today might just as easily migrate to any other technology if they don’t get the best or don’t feel secure about the future. In order for them to invest in and use a global payment like Dash for their daily payments, they must know that the team is investing their time to provide an experimentally and pragmatically scalable network.”
Dash has invested in long-term research at several junctures, most notably funding the ASU blockchain research lab that produced this scaling paper and distributing research grants. Dash’s founder Evan Duffield has also founded Dash Labs to similarly research the network’s growth long-term.