- The Elrond project seeks to eradicate the scalability issue of blockchains without compromising decentralization and security.
- A blockchain platform with high throughput, fast execution speed, and low transaction cost.
- Elrond is bringing a solution to enhance scalability using Adaptive State Sharding and Secure Proof-of-Stake (SPoS).
Blockchain trilemma, an issue of accommodating scalability, decentralization, and security together in a blockchain without compromising one or the other, has been a significant hurdle in the way blockchain technology becomes mainstream. Often, traditional blockchains opt to reduce scalability to ensure security and decentralization. Elrond, an intelligent contract blockchain project, aims to develop a scalable blockchain ecosystem that exhibits lightning-fast network speeds and supports decentralized applications (dApps).
What is Elrond and What Makes it Unique?
Developed by a team of entrepreneurs in 2018, Elrond is a public blockchain-based platform that employs a combination of Layer-1 sharding and secure Proof-of-Stake (SPoS) techniques to create an ‘internet-scale’ economy exhibiting utmost scalability, efficiency, security, and interoperability. It also enables the users to develop cryptocurrencies and dApps of different utilities on top of it.
The Elrond blockchain stands out due to its high transaction speed, low transaction fees, and higher transaction volume. Its smart contract platform has been reported to execute 15,000 transactions per second (TPS) with a latency speed of six seconds and fees as low as $0.001. As opposed to the market leaders, e.g., Ethereum (currently with 15 TPS), Elrond offers a way better performance in terms of speed.
Since the project is backed up by thousands of validators (3,200 to be exact), Elrond claims that it is plausible to scale up its transaction speed to 263,000 TPS, if necessary, which would be significantly helpful when blockchain is adopted mainstream.
Moreover, Elrond claims that the ‘easy to write’ and ‘fast to execute’ features of its smart contracts will give developers more freedom to modify the contracts to fix bugs and errors after deployment.
Elrond’s native cryptocurrency, eGOLD, which goes under the ticker EGLD, is used throughout the network for various purposes, such as governance, staking, and executing transactions.
In a recent event around November 2022, Elrond officially rebranded as “MultiversX” representing its shift in focus towards the metaverse development. MultiversX also launched three new metaverse-based products to reflect its new transformation: xFabric, xPortal, and xWorlds.
How Does Elrond Achieve Scalability?
With the growing vision of building a high-throughput, decentralized, scalable, and secure blockchain network, Elrond uses three key technologies:
- Adaptive State Sharding
Sharding is a crucial technique Elrond uses to make its network highly scalable and cost-efficient. Sharding involves splitting thousands of transactions into chunks or shards, allowing the nodes to process only that portion of the network’s transactions.
The adaptive state sharding technique used in Elrond merges three different types of sharding techniques, (i.e., network, transaction, and state) to speed up the transactions via parallel processing.
Adaptive sharding increases the blockchain’s performance, maintains stability, reduces fees, and increases throughput without reducing overall functionality.
- Secure Proof-of-Stake (SPoS) System
Traditional blockchains face scalability issues as they verify their transactions using Proof-of-Work (PoW) consensus, which is a very energy-consuming process.
Elrond, in contrast, employs another consensus protocol named Secure Proof-of-Stake (SPoS) system. This advanced version of the original PoS protocol depends on a system of nodes and validators required to stake their EGLD tokens to become a participant.
This protocol uses a rating system where the validators are rated based on their performance and the tokens they stake to ensure the network’s security. Combining the network rating for each node with the amount of EGLD tokens staked, the network randomly chooses a group of validators to propose, verify, and add the transactions to the blockchain.
SPoS protocol ensures high security of the Elrond system as a third of the nodes are shuffled every 24 hours into a different shard. Moreover, it expedites the transaction process as no time is wasted to form a consensus group and select random validators.
- Elrond’s Virtual Machine or Integrated Development Environment
Another feature of Elrond that makes it a scalable blockchain network is its virtual machine for building smart contracts. This feature is based on an open standard called WebAssembly (Wasm) that supports various programming languages (e.g., C/C++, Go, Rust, and TypeScript) that developers can easily use to create dApps for different products and services.
Conclusion
Elrond is blooming as the most exciting and competitive scalability solution for blockchain systems. Using a combination of Adaptive State Sharding, a Secure Proof-of-Stake (SPoS) system, and a Virtual Machine, Elrond can yield faster transactions of up to 15,000 TPS, security, scalability, and tools for app development. Although its scalability is yet to be fully utilized, Elrond is giving tough competition to the traditional blockchains and will become a necessary smart-contract-based software soon.
