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The Blockchain Trilemma and Its Impact on the European Blockchain Market

Published: | IDC | 12 Pages | Delivery time: 1-2 business days


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The Blockchain Trilemma and Its Impact on the European Blockchain Market
Published: December 17, 2020
Content info: 12 Pages
Delivery time: 1-2 business days
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This IDC Market Perspective discusses the blockchain trilemma. DLT creators must manage a careful balancing act between decentralization, scalability, and security. This document looks at the advantages and disadvantages of maximizing each of these three properties. It also provides a useful framework to compare DLTs with each other and discusses how DLT developers' choices are strongly influenced by popular use cases. " Looking at the entire DLT landscape, we see that there has been focus on improving scalability and gradual movement away from platforms that maximize decentralization. These trends are understandable as early DLTs were far too slow for commercial use. However, decentralization is also a vital component of the technology and should not be overlooked.," aid Radoslav Dragov, senior research analyst for European Customer Insights and Analysis and European Blockchain lead.

Table of Contents
Product Code: EUR145773120

Executive Snapshot

New Market Developments and Dynamics

  • Introduction
  • The Trilemma Pillars: Decentralization, Scalability, and Security
    • Decentralization: Sacrificing Speed for Security and Distribution of Governance
      • Benefits
      • Downsides
    • Security: Nonnegotiable Concern of Any DLT
      • Benefits
      • Downsides
    • Scalability: The Metric that most New DLT Projects Chase
      • Benefits
      • Downsides
  • Finding the Right Balance: There Is no One Correct Answer - It Depends on Users' Needs
    • DLTs that Emphasize Decentralization and Security Are Looking for Solutions to Increase Scalability
    • DLTs that Emphasize Security and Scalability over Decentralization Make Up the Bulk of New Projects, Are Preferred in the Enterprise Space
    • No DLT Project wants to Skimp on Security, But Some Unwillingly Do So when Trying to be Decentralized and Scalable
    • There Is no "Right" Approach to the Trilemma
  • Blockchain Trilemma Through the Prism of Blockchain Spending in Europe
  • The European Commission Favors Projects with High Scalability and Small Carbon Footprints

Advice for the Technology Supplier

  • Security Is an Indispensable Component of the Trilemma
  • The Race to Hit the Highest Number of Transactions per Second can Sometimes Be Counterproductive
  • Linking Private DLTs with Public Ones could Point to a Solution out of the Dilemma

Learn More

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  • Synopsis