Challenges and Emerging Solutions for Public Blockchains

Abstract

With the interest and attention that the Blockchain and the Distributed Ledger Technologies (DLTs) have recently demanded, the technology is advancing at a very high rate. With investors and applications in a wide variety of fields, a lot of funding and efforts are being driven into bringing the technology to everyday use. The community and companies are coming up with new ways to collaborate, which makes the blockchain ecosystem evolve at full tilt. Consequently, this paper’s aim is to review the academic and grey literature and to provide readers with information about the evolution, benefits and challenges of the Public Distributed Ledger Technologies and to discuss the latest solutions, which are being developed for bringing decentralization closer to the mainstream. The paper reviews the Directed Acyclic Graph (DAG) structured distributed ledgers with focus on the Hedera Hashgraph, a novelty DLT bringing a unique consensus algorithm with new use-cases enabled by new cryptoeconomic mechanisms, as well as vital services, such as Solidity smart contracts and distributed file storage. Then, we are going to explore second-layer network protocols, a major topic for solving scalability issues and for decentralizing cryptocurrency exchanges. The article tries also to identify the particularities of these technologies and how they bring specific answers to the blockchain trilemma, consisting in three themes - scalability, interoperability and sustainability.