Blockchain and Beyond – A Survey on Scalability Issues

Blockchains have gained significant popularity in certain areas over the past decade. The establishment of a distributed consensus among untrusted participants has set new standards and enabled protocols that were not possible before. The substantial critique of the Bitcoin network centers on its high energy consumption. However, its popularity has shown majorscalablity problems such as slow completion of transactions and the high transaction fees, particularly especially when transferring small amounts of money. After outlining the underlying structural reasons for these problems, we will briefly explain ideas for addressing them, using several projects as examples. Beyond that, we present an alternative concept utilizing Directed Acyclic Graphs (DAGs) which achieves a unified decentralized consensus in the network without using a traditional blockchain. The IOTA project has made significant progress with the so-called Tangle in version 2.0 and represents a promising approach for various application areas.