Jul 24, 2021

ince founded by Vitalik Buterin in 2014, Ethereum has quickly risen to become the number two cryptocurrency in the world with the potential to challenge Bitcoin’s pole position in the future. The usage of Ethereum increased manyfold through the ICO wave that swept the whole world in 2017. Though the ICO craze has subsided, the emergence of DeFi and NFT has created a second wave of Ethereum adoption as most DeFi and NFT platforms are built on the Ethereum blockchain.


However, Ethereum-based platforms are increasingly facing scalability issues comprising high gas fees and network congestion. Blockchain developers have been trying to solve the Ethereum scalability trilemma by creating so-called layer 2 solutions that feature new consensus protocols like POS and BFT to replace the energy-driven and environmentally unfriendly POW. In recent years, many solutions were proposed to solve the scalability trilemma.


Basically, the solutions can be categorized as layer 1 and layer 2. Layer 2 protocols are built on top of the Ethereum Mainnet while layer 1 protocols are completely new kinds of blockchain. Besides that, there are other protocols that cannot be classified as layer 1 or layer 2 solutions but rather as independent blockchains that run parallel to another layer 1 blockchain. One good example is Binance Smart Chain, which is not a layer 1 or layer 2 protocol, but a fork of the Ethereum blockchain.


To help readers understand the core concepts of various solutions that attempt to solve the Ethereum scalability trilemma, the book provides detailed descriptions of various DeFi and NFT platforms that have been implemented based on these solutions. Additionally, readers will learn how to invest in these platforms to reap good rewards.