Information-Theoretic Approaches to Blockchain Scalability

Abstract

Blockchain systems fundamentally provide an environment of distributed trust in networks by creating individual copies of cryptographically secure ledgers of all transactions on the network at each node in the network. This redundant storage when combined with democratized transaction validation and the security from recording the ledgers as hash chains enable a self-sustainable system of distributed trust. However, the principal source of security and fairness of blockchain systems is from every participating node maintaining a local record of all transactions in the network. This in turn implies a significant amount of storage cost that scales prohibitively with larger block sizes, higher transaction volume, greater size of the network, and time in use. In this chapter, we will take a few blockchain applications as examples and highlight the storage and communication demands for maintaining a full node in the network. We then study some approaches with roots in coding theory that aim to reduce this cost and enable network scaling. Finally, we study some practical use cases in establishing distributed trust in computational systems using coding-theoretic methods.