Professors from seven advanced institutions in the US are currently working on developing a cryptocurrency that would be better than Bitcoin. This is according to a report by Bloomberg earlier today.
Unit-e to solve Bitcoin issues
According to the report, the cryptocurrency dubbed Unit-e will be designed to perform a function that Bitcoin has proved incapable of: processing thousands of transactions a second. The professors from colleges including the Massachusetts Institute of Technology, Stanford University and the University of California, Berkeley have partnered to create a cryptocurrency that would achieve massive transaction speed while keeping its decentralized features.
The cryptocurrency is the first initiative of Distributed Technology Research (DTR), a non-profit organization that is supported by hedge fund Pantera Capital Management LP. The research body was set up to develop decentralized technologies.
Bitcoin is the leading cryptocurrency and allows individuals to perform transactions without going through any central authority. Despite the large followership that the cryptocurrency has garnered, adoption continues to be a problem.
Bitcoin has some restrictions that have so far affected its performance and scalability. This has made it hard for the cryptocurrency to be used as an everyday unit of payment by consumers across the globe. The professors undertaking this research are working on a cryptocurrency that would process transactions faster than Visa.
Joey Krug, co-chief investment officer at Pantera Capital in San Francisco, stated that “The mainstream public is aware that these networks don’t scale. We are on the cusp of something where if this doesn’t scale relatively soon, it may be relegated to ideas that were nice but didn’t work in practice: more like 3D printing than the internet.’’
DTR is looking to launch the cryptocurrency in the second half of the year, and it is expected to process roughly 10,000 transactions per second. If that is achieved, it would be so much higher than the roughly seven transactions per second currently recorded by Bitcoin and 10 to 30 transactions for Ethereum. It would also be faster than Visa that processes roughly 1,700 transactions per second.
Pramod Viswanath, a researcher on the project, stated that for DTR to achieve the speed and scalability required, they deconstructed the blockchain technology used by most cryptocurrencies and are looking to improve upon it. He revealed that DTR first understood the performance limit of blockchain technology before they design technologies that would operate close to those limits.
The researchers have published research papers on the different aspects of the technology. They are now looking to use new mechanisms they developed for reaching consensus and new ways of sharding. The team is also working on new payment channel networks which they consider crucial if they are to attain the targeted transaction speed.
Crypto community also working on boosting transaction speed
The crypto community has been working on different initiatives to help boost transaction speeds of cryptocurrencies. Lightning Network is one of the initiatives designed to make payments faster and cheaper. Segregated Witness or SegWit is another solution that aims to make transactions faster on the Bitcoin network.
Andrew Miller, head of the Unit-e independent technical steering committee noted that success for Unit-e is not guaranteed at the moment. He expects the best technology to win in the long-run and that would be a great thing for the Fintech sector.
Viswanath revealed that Unit-e is DTR’s first initiative. It will work on other projects including smart contracts. He concluded by saying “Bitcoin has shown us that distributed trust is possible but its just not scaling at a dimension that could make it a truly global everyday money. It was a breakthrough that has the capacity to change human lives, but that won’t happen unless the technology can be scaled up.