Bitcoin, Bitcoin’s Core developers, and Bitcoin’s underlying Blockchain technology have certainly done their job up to this point. Bitcoin has proven to live up to the hype in actual ability and overall value. This global technological experiment has worked out almost perfectly, except for one thing.
Bitcoin still does not scale effectively, limited to only seven transactions per second, in theory, and less than half of that in real-life applications. Segregated Witness, or SegWit, doesn’t seem to be coming to save the day anytime soon. However according to its creators, there is a new proposal that may solve Bitcoin’s problems that SegWit cannot. This has the potential to turn Bitcoin into the global economic force it can be when it is scaled properly. Can this newly proposed solution do the trick?
SegWit has not exactly set the mining world on fire with its adoption votes of affirmation. Apparently, SegWit is not the easiest thing to implement, and barely one-quarter of the voting community agrees that SegWit is the way to go. According to Joshua Lind, Ittay Eyal, Peter Pietzuch, and Emin Gün Sirer, Segregated Witness is not the way to go because they have a more elegant solution to one of Bitcoin’s biggest concerns.
Their research indicates that just raise the block size to 4MB, or even 10MB, will not allow Bitcoin to truly scale, as desired. Lightning Network and Duplex Micropayment Channels can scale Bitcoin but will require fundamental changes to Bitcoin’s protocol, which is a sub-optimal solution. What if you could add something that added almost 2500 transactions a second to the Bitcoin protocol without the major network changes required by SegWit and Lightning?
The team calls it Teechan, and they say it scales Bitcoin while being easy to add, and its tech has been proven effective because it leverages trusted execution environments with secure hardware components found in recent commodity processors such as the latest batch of Intel CPUs with Software Guard Extensions.
“Teechan does not require any changes to the existing Bitcoin network; it is secure even in the presence of transaction malleability,” says the group in their blog post this week.
“Teechan is efficient: Payments are completed with a single message. Teechan is space-efficient, requiring only two transactions to be placed in the Blockchain in total under all scenarios. As a consequence of lower dependence on on-chain transactions, Teechan is less open to attacks based on Blockchain flooding. Consequently….our prototype achieves a throughput of 2480 transactions per second per channel, with settlement latency overheads of 0.4 ms.”
Lightning Network and other similar offerings may not be deployable until SegWit is accepted, yet Teechan does not require SegWit to become live or effective. A single message allows one to send Bitcoin with Teechan, making it notably faster than Lightning Network, which requires multiple round trips between the two parties to complete a single transaction.
The team has a draft paper and is creating an alpha version in a few weeks, but this may be a potentially Bitcoin addition sometime in 2017. A solution to this scaling problem can’t come soon enough.