Thanks in major part to new a Ethereum application, Cryptokitties, ETH blocks have been consistently full, probably for the longest run ever. This gives us a unique opportunity to take a look at how well the ETH network scales, and whether or not their software architecture lives up to the title “world computer.”
Since the eponymous marketplace for digital cats launched on November 28th, the ETH network has been able to push between 6–700,000 thousand transactions a day, or around 7–9 transactions per second. Theoretically, this could be as high as 13–14, but that assumes no one is transacting tokens or using smart contracts.
And that’s the problem: the “gas cost,” (or total percentage of fees in each block) of a single transaction on Ethereum can be much larger than a simple transfer depending on the attached interactions with smart contracts. The more complex the operation, the larger the gas cost.
Ethereum Has a Long Way to Go Before It Is a True ‘World Computer’
Because Ethereum limits blocks based on total gathered fees rather than raw transaction size, the throughput of the network decreases as people build things that actually make use of Ethereum’s presented use cases. At present, Ethereum can only push about 15 percent more transactions per second than Bitcoin, while each ten-minute section of blocks produces about 5 times as much (or more) data that requires on-chain storage.
That makes Bitcoin a little more than 4 times as efficient per transaction — despite the fact that Bitcoin constantly gets lampooned for poor scalability. As more complex applications start relying on Ethereum, this inefficiency will only continue to increase.
So to recap: Ethereum is 400 percent less efficient than the cryptocurrency hailed as the worst scaling thing in the space. This efficiency will only continue to dwindle as more people build things on top of it, and the only way to increase throughput is to increase the gas limit on each block, which linearly reduces that efficiency even further.
While the Platform Ethereum provides is interesting, a world computer it is not. At least, not without major revisions to its design.
What do you think about these findings? Share your thoughts in the comments section.
Images via Mistaspeedy//Imgur, Etherscan