Scaling: sidechains and Layer 2

Scaling

Due to network congestion, the cost of transaction fees reduces the viability of lower value transactions on mainnet.

Proof of Authority sidechains

Proof of Authority sidechains have been an option to scale for a while now. They need to be secured by the (significant) reputation of the authorities. Ideally when the reputation (or damage to reputation) of any individual authority is of a higher value than the value stored in the network.

POA Network or the xDai chain are examples of Proof of Authority sidechains.

:warning: sidechains are not trustless, users need to trust the authorities

Layer 2

Layer 2 is coming soon™.

The Great Reddit Scaling Bake-Off is worth following to see what solutions there are for a user base of 400 million plus monthly users.

Matter Labs created a comparison framework for evaluating Ethereum L2 scaling solutions

A list of some of the Layer 2 projects can be found in: