The thing that excites many in the currency industry is the idea for payments to move at the speed of light. Are they crazy or genius? Well, the development of a system with this ability is already in the works for Ethereum and is known as the Raiden Network.
The goal in development is to have the ability to send and receive payments at high speeds across the network. The way this can be done is through a model where users can privately exchange messages which sign the transfer of value. Currently, the model where every transaction hits the giant ledger on the blockchain is becoming less efficient.
Benefits of Raiden
Along with the speed, Raiden will be able to bring costs down significantly for transactions. That has been the desire since the introduction of Bitcoin and Ethereum. For Bitcoin, the blocks currently take 10 minutes to be processed which can be an annoyance. However, Ethereum has a target on 12-second block times which is improving speeds significantly.
When implemented, the Raiden network could help increase the capacity of Ethereum. It will allow the Ethereum network to scale up from doing 25 transactions per second to above 1 million transactions per second. In addition, the Raiden Network hopes to introduce smart contracts into the system as well.
If you take a poll from most currency experts, bringing the technology to more people is a huge priority. However, the issue is that currently blockchains can’t support the transactions of millions of people.
For example, Visa can roughly support 45,000 transactions per second while Ethereum can only do 25 in a second.
Every node on the bitcoin and Ethereum networks, keeps a record of all transactions made in order to verify new transactions. The more transactions, the more complex the calculations get on the blockchain. This also equates to more GPU power being needed to move a transaction across the network.
In conclusion, the Raiden network will help take load off the ethereum network and help power transactions faster. The scalability in this new technology addition could be game-changing.