Ethereum News: With the promise of significantly increasing the number of processed transactions per second, Ethereum welcomes its latest update of Raiden Network. One of its most critical architectural upgrades that could solve the networks’ scalability issue.
Raiden Network is quite similar to Bitcoin’s Lightning Network in terms of their concept. Two users establish a payment channel that allows them to perform an infinite number of off-chain transactions, which do not interact with the blockchain until the channel is closed. Upon closing the funds are distributed between the two participants, in accordance with the last balance cryptographically signed by them.
This way an infinite number of transactions would appear as two movements in the blockchain corresponding to the creation and closing of the channel, which ensures the transparency of the movements, avoiding potential double spending.
Notably, establishing a payment channel with each user isn’t necessary as the network automatically reroutes the funds to third parties through a network of payment channels. This way, the more people participate, the more efficient Raiden will be. Quite the contrary to the current situation wherein a high number of users lead to congestion over the blockchain.
Over 1 Million Transactions Per Second
The Raiden team claims that after the solution is fully deployed, it could process about 1 Million Transactions per second when combined with sharding and plasma. A quite significant figure in comparison to Ethereum’s current 15 tps and Visa’s maximum theoretical network capacity of 65000 tps.
Vitalik Buterin, co-founder of Ethereum illustrated the technological leap and elaborated about the complementarity of layers 1 and layer 2 solutions in an OmiseGO AMA YouTube video on May 30th.
“The reason I think layer 1 and layer 2 [networks] are complementary is because ultimately, if you look at the math, the scalability gains from the layer 1 improvements and layer 2 improvements do ultimately multiply with each other. If you have a Sharding solution, the Sharding solution itself might increase the scalability of Ethereum by a factor of 100, or eventually even more. But then, if you do Plasma on top of the scalability solution, then what that means is, you’re not just doing 100 times of the amount of activity but you are doing 100 times the amount of entrances, the amount of exits, and dispute resolutions”
The Red Eyes Release
Dubbed as the Red Eyes Release, the alpha version has certain limitations. Despite being usable, deposits cannot exceed 0.15 ETH per channel, and for now, only transactions in ETH ( an ERC20 token used for testing) can be made.
Features Included In The Red Eyes Release
Opening, topping up, closing and settling of payment channels
Single and multi-hop transfers
Automatically joining a token network and opening channels with peers
REST API with endpoints for all functionalities
Raiden Explorer, visualizing the live status of the Network
Rewritten and more gas efficient smart contracts (i.e. only one contract per token network)
Improved protocol for dealing with edge cases
Recoverability in case of an irregular shutdown of the Raiden node
Integration of the Matrix transport protocol for messaging
Notably, the Raiden’s announcement sends both ETH and RDN on a bullish streak. Ethereum surged to near 15% in the last 24hours and RDN (Raiden Network Token) rose to near 40% in the last week