Introduction
Oh, the blockchain. The technology that will change everything. The future of business and government. Every day, I see another “blockchain for X” article on my Facebook feed. Most of them are just nonsense—some combination of buzzwords and marketing speak about how the technology will revolutionize some industry or other. But beyond all the hype, there are some solid use cases for blockchains: for example, in supply chain management or data storage (although even there there are alternatives). But if you’re an entrepreneur looking to build your own blockchain network or develop an application that uses one, you need to know what makes a good blockchain design before you can make wise decisions about how to use this new technology effectively.
How to build a blockchain network that doesn’t suck
How to build a blockchain network that doesn’t suck
Blockchain technology is currently being used by companies and governments around the world, but there are still many challenges to overcome before it becomes mainstream. One of these challenges is scalability: how can you build a decentralized network that can handle thousands or even millions of transactions per second? Another issue is security–if your system has thousands of nodes running different versions of its codebase, how do you ensure that only valid transactions are recorded on each one?
There are also less technical issues related to decentralization as well; for example, if all of your users need to run their own personal node in order for their transactions (or blocks) to be accepted by other nodes in your network… well… good luck getting them excited about using your product!
Decentralization is hard.
Decentralization is hard.
Blockchain technology is decentralized by design, but that doesn’t mean you can build a blockchain network that doesn’t suck without doing a lot of work. You will have to make decisions about how your system will operate and what kind of data it needs to store–decisions that will affect both the security and usability of your application.
Network effects matter.
Network effects are when the value of a network increases as more people join it.
Example: Facebook is more useful if your friends are on it, so you’re more likely to join. This creates a positive feedback loop where new users attract old users and vice versa, which leads to exponential growth in membership over time.
Network effects can also be negative: if everyone else is using a bad product, then even if you know better and would enjoy using something better yourself (e.g., Google instead of Bing), there’s no point in switching because there won’t be anyone else around who cares about the same things as you do!
From the beginning, you need to design your codebase with scale in mind.
From the beginning, you need to design your codebase with scale in mind. One of the best ways to do this is by making sure that everything is modular and can be easily swapped out. For example, if one part of your blockchain network breaks down or gets too crowded (like when Ethereum users started using decentralized apps), then it should be easy for you to remove that part from the equation until things settle down again.
For example: If your blockchain network was built on top of Ethereum’s platform, but then users started flooding in because they couldn’t handle all their transactions anymore–and now there are too many people trying to use it at once–then this would cause problems with how fast things ran because everyone would have difficulty accessing their tokens or digital assets through their wallets and exchanges; however if instead we were able to just take off “Ethereum” completely so no one could access anything through them anymore (i mean literally everything including wallets), then everyone would still be able to use all those other services like Coinbase which aren’t dependent upon Ethereums infrastructure anymore since they’re not connected directly either way; therefore removing these dependencies allows us more freedom over our choices regarding what type technologies we want implemented into our systems.”
Your blockchain needs multiple layers of redundancy and security.
The reason you need multiple layers of redundancy is because if one of your nodes goes down, or if there’s a security breach on one of them, you want to be able to quickly get back up and running. You don’t want your blockchain network to be dependent on just one node at all times–that would make it very easy for someone with malicious intent (or just bad luck) to take down your entire network by attacking that one single point in the chain.
The same principle applies when it comes to security: having multiple layers means that even if an attacker somehow gains access into one layer of security guarding your blockchain, they won’t be able to get through all other layers as well; this helps ensure that no matter what happens within any given layer (whether it’s hardware failure or human error), there will always be another line of defense between them and whatever sensitive data they might try accessing next time around.
You must be prepared for outages and attacks.
You must be prepared for outages and attacks.
In this day and age, you can’t assume that your blockchain network will be untouchable. Your nodes may get attacked by hackers trying to steal your crypto-currency or even just knock the network offline by flooding it with requests.
A good network design focuses on simplicity, not functionality.
The first step to building a blockchain network is to determine what you want it to do.
This seems obvious, but it’s worth considering all the different ways you could use a blockchain network–and then choosing one that makes sense for your product or service. The most common use case for blockchains right now is cryptocurrency: Bitcoin and Ethereum are examples of digital currencies built on top of public blockchains, which means anyone can join their networks as long as they buy into those cryptocurrencies’ respective ecosystems (i.e., buy bitcoins). However, if your business doesn’t need its own currency system–or if doing so would add unnecessary complexity–then there’s no reason why using an off-the-shelf cryptocurrency isn’t good enough for now!
Don’t just think about how you can use blockchain for your product or service – think about how you can design a blockchain that can actually scale up and handle lots of users
You may be wondering how to build a blockchain network that doesn’t suck. If so, we’ve got you covered!
Blockchain technology is still in its infancy and there are many issues that need to be solved before large-scale adoption can happen. Here are some of the most pressing problems:
- Scalability
- Security
- Interoperability
Conclusion
The blockchain space is still very young, and there’s a lot of room for experimentation. But if you want to create a successful network that lasts, it’s important to think about these things from the beginning.
