What Is Blockchain Sharding? Does It Matter?

The innovation in the blockchain industry is constantly changing. One of the recent upgrades, which has changed the way blockchains choose their nodes is known as sharding.

But what is sharding exactly, and is which blockchains utilize it? Read on to learn the details of this specific blockchain upgrade and how it can change the future of blockchain as a whole.

What is Blockchain Sharding?

Blockchain sharding is the process of dividing a blockchain into smaller pieces. It’s a practice commonly used in databases to lower the computing power needed to process a particular database. In blockchain, sharding often divides the workload across multiple nodes, allowing for an increase in processing power and speed.

The best metaphor used to describe blockchain sharding is adding additional lanes to a highway for the purpose of easing traffic jams. This way, specific nodes can focus only on their traffic, rather than the traffic of the entire blockchain, thus allowing multiple transactions to be processed simultaneously.

There are a few different types of sharding; the most popular in blockchain is known as horizontal sharding, which is basically dividing the blockchain data into multiple rows that can be processed simultaneously.

How Does Blockchain Sharding Work?

Although sharding might sound like a simple solution, it is actually quite complex, especially on a blockchain in which other “rules” are present to protect the blockchain (such as those in place to prevent double-spending). Remember, even though sharding is the process of splitting the blockchain, all aspects of the chain must remain in communication with each other—something which is very difficult to attain.

Most blockchains that choose to add sharding start by dividing the blockchain into layers. One of these layers will be the one that validates and processes transactions, and another which is coordinating these transaction assignments and communicating them to the distributed ledger. This means that though transactions can be processed simultaneously, each transaction will be checked before being added to the ledger, thus preventing double-spending. This is known as state sharding, and is the most basic of the blockchain sharding adaptations.

There are several ways to add sharding to a network. One of the most common is dynamic sharding, where the number of shards can be increased as demand for the network increases. This way the blockchain isn’t always utilizing the same number of shards, thus proving some protection against the 51% problem.

The Benefits of Blockchain Sharding

Of course, blockchains wouldn’t utilize sharding if it weren’t beneficial to them. Below are the key benefits of blockchain sharding.

Increased Processing Speed

The main reason blockchains turn to sharding is that it increases the overall speed of the blockchain, allowing for transactions to process faster. Processing speed is a major hurdle for even the most popular blockchains, notably Bitcoin.

Lower Fees

If a blockchain has a huge influx of transaction requests, this can also increase the fees. As such, blockchains that introduce sharding, often have lower fees. These savings allow the blockchain to be more accessible and more widely used—both important aspects for adaptation.

Increased Processing Power

Of course, if the blockchain is processing transactions faster, it can process more transactions overall. This increases the usability and scalability of blockchains, and is something many blockchains are searching for because they want to become more mainstream.

Diversity and Resilience

As we mentioned above, sharding often requires more nodes than simply processing transactions in order. As such, whenever sharding is added to a blockchain, the diversity and utilization of nodes increases. This can help the blockchain become more resilient to future problems and government changes, (of course it does also increase risk but that’s a discussion for the downsides!)

The Downsides of Blockchain Sharding

As with anything amazing in this world, there are also downsides, and blockchain sharding is no different. Below are some of the downsides of blockchain sharding, many of which are the sole reason this process isn’t more popular.

Centralization

Decentralization is a major draw for blockchain users, and unfortunately, sharding is a process that can lead to centralization. This doesn’t mean all blockchains utilizing sharding are centralized, just that the processes that allow sharding tend to introduce elements of centralization to a blockchain. Some of these adjustments are worthwhile of course, but it can dissuade some individuals from using said blockchain.

It is worth noting that when sharding is added to a large blockchain, like Ethereum, centralization is less of an issue because the network itself is so large and the number of nodes utilized to process each transaction remains high. This is more of a concern on smaller networks that implement sharding.

Risk of Inconsistency

When transactions are split as they are in sharding, the risks of inconsistencies can increase, especially if the coordination layer of the blockchain isn’t built to be robust. Again, this is something that can be negated with enough development and research, but it is a valid concern when discussing sharding. All it takes is a handful of nodes on the coordination layer to communicate ineffectively, and data can be recorded incorrectly.

Increased Difficulty of Use

Blockchain sharding can be a difficult process to understand, and individuals may shy away from a blockchain if they become overwhelmed with information. Obviously we hope this isn’t the case, but one of the reasons we are writing this article is so individuals can feel less overwhelmed by complicated topics which prevent them from buying crypto with confidence.

Which Blockchains Utilize Sharding?

Despite its downfalls, many blockchains have no choice but to consider sharding for future scalability. One of the main blockchains implementing sharding is none other than Ethereum. Of course, the behemoth isn’t the only one, though, and below are a few other blockchains that utilize sharding to increase blockchain power and speed.

·      NEAR Protocol

·      Polkadot

·      Zilliqa

·      MultiversX (Elrond)

·      Hedera

It is important to note that blockchains have many options for introducing sharding, and not all sharding processes are created equal. In general, if you plan to utilize a blockchain that uses sharding, it’s important to research how it is implemented and how issues like 51% and double-spend are prevented. This way you can sleep easy at night knowing your investment is secure.