Scaling Blockchain Systems using DAG

Abstract

Directed acyclic graphs are used for one primary reason: they make it easier to build several blocks at once. The number of forks in a blockchain naturally grows as the rate at which blocks are generated increases. As a consequence of this observation, several experts have come to the opinion that organising the resulting directed acyclic network is the most effective way to solve the scalability issue that plagues Bitcoin and other similar cryptocurrencies. A significant difficulty for this system arises from the fact that blocks created concurrently or in close proximity may contain similar or conflicting transactions, all of which must be handled and organised in linear order. The idea of using several blockchains, each of which processes transactions independently based on the Sender's address, is presented as a possible alternative method. Consensus algorithms continue to be the limiting factor in the size of a blockchain network and the speed with which data can be published, despite the advancements in blockchain technology and the advent of new use cases. Despite blockchain's ability to accommodate a greater variety of data, this remains the case. Immediate action is required to address the critical problem of how to boost alliance blockchain performance in a secure and efficient manner.