Launched in 2018, the Nervos project has become one of the fastest-growing blockchain networks. You may think, “Ah, yes, yet another blockchain to congest the market.”
But Nervos isn't just another kid on the block (pun intended).
It has a specific mission: to extend the boundaries of blockchain scalability.
Early blockchain systems like Bitcoin and Ethereum have had difficulty achieving proper scalability. For example, Ethereum has a 7-transactions-per-second processing rate, compared to Visa’s 24,000-transactions-per-second figure.
Nervos Network promises a new solution that enhances scalability yet guarantees safety and decentralisation. This article breaks down Nervos Network's architecture and explains its drive to solve the blockchain scalability problem.
Let's dive in!
What is Nervos?
Nervos is an open-source blockchain ecosystem designed to solve some of the problems confronting Bitcoin, Ethereum, and other legacy blockchain networks. One of the central preoccupations of the Nervos Network is improving scalability and enhancing user experience.
The Nervos Network is made up of two layers:
Called "Common Knowledge Base," Nervos’ base layer is an open, permissionless, secure, and decentralised blockchain network. Layer-1 acts as the consensus mechanism for the entire ecosystem and secures assets stored on the blockchain.
Anyone can conduct transactions on the base layer using the Nervos native token, CKByte. In addition, a token entitles the holder to state storage space on the CKB blockchain.
Nervos Layer-2 blockchain is an additional layer built to operate side-by-side with the base layer. In the Nervos Network ecosystem, layer-2 handles computation, promoting higher throughput and improving scalability.
What Is Blockchain Scalability and Why Is It Important?
Scalability in blockchain means the ability of a network to handle exponential increases in its user base. Ideally, a blockchain network should process a higher rate of transactions and still maintain optimal functioning.
But that rarely happens in real life.
For example, CrytoKitties, a game built on Ethereum, crashed the network in 2017 after it went viral. Besides, the processing rate of the major blockchain networks pales in comparison to that of traditional systems.
These instances have encouraged experts to question blockchain's practicality. If it cannot handle an uptick in a game’s players, how will it handle enterprise applications with millions of users?
Solving Blockchain's Scalability Problem: The Nervos Solution
Scalability is central to blockchain's survival; already, traditional systems like VisaNet can process an insane amount of transactions seamlessly. Blockchain developers must increase throughput without compromising on decentralisation and security.
There is no shortage of solutions developed to solve the blockchain scalability problem.
We have layer-1 solutions which change the base layer to improve throughput. Some layer-1 solutions decrease the time required to validate nodes, while others increase the space in each block.
Layer-2 technologies involve overlaying an additional protocol on a blockchain network to execute transactions. Called “off-chain” solutions, layer-2 protocols encourage higher throughput without compromising the blockchain’s decentralisation and network security.
However, both solutions have their failings. Tampering the base layer, as layer-1 technologies do, to achieve greater throughput reduces network decentralisation and security. Similarly, layer-2 technologies trade off some measure of security for higher scalability.
Nervos combines the best of both worlds and utilises a double-layer system for equal decentralisation, scalability, and security.
Let's take a peek into the Nervos ecosystem and its potential for scaling blockchain solutions:
As explained earlier, the Nervos Network has two branches: Layer-1 and Layer-2. Layer-1 powers the entire network, providing validation and security for transactions conducted on the blockchain. Meanwhile, layer-2 handles all the computation executed on the network.
This has several implications.
By dividing the workload between a base and upper layer, Nervos creates optimal conditions for achieving scale at never-before-seen levels. In this new ecosystem, the base layer validates transactions and settles disputes; it never participates in the actual processing or computation of transactions.
The upper layer increases throughput and increases the transaction-per-second, aka throughput, of the blockchain network. At the same time, layer-2 protocols can rely on the base layer's proof-of-work consensus mechanism to secure transactions.
More importantly, Nervos solves scalability issues that plague smart-contract platforms like Ethereum. The underlying base layer's PoW architecture can adapt to different levels of user traffic. This means no more congested networks and no skyrocketing gas fees.
Developers building decentralised apps (dApps) will find the Nervos Network ideal for scaling their applications. For instance, it allows users to create highly customisable applications with cryptographic primitives.
A cryptographic primitive is to dApps what programming languages are to traditional applications. They are the basic building blocks of any blockchain application and can be adapted to suit developer needs.
Customisation-friendly dApps allow developers to manage trade-offs with respect to trust, privacy, decentralisation, and throughput. Thus, each application can be easily upgraded and tweaked to adjust to future changes and growth.
Don't Be Nervos About the Future
Nervos is a one-of-a-kind solution to the blockchain scalability problem. Its double-layer architecture encourages higher throughput and keeps the decentralisation and security benefits of the original blockchain.
As cryptocurrency-powered networks become mainstream, Nervos will play a key role in ensuring wider adoption of blockchain technologies. Not only will Nervos push the limits of blockchain scalability, but it’ll also guarantee a better experience for all users.