Racing for Adoption: Ultra-Fast Blockchains Emerge as Key Contenders (Opinion)

High-speed blockchain ain't just a challenge, it's the make-or-break factor for Web3. If it can't keep up with the smoothness users crave, Web3 will be yesterday's news, no matter how cool its decentralized features are.

A peek at the development landscape reveals the urgency: according to a16z's Builder Energy Dashboard, infrastructure development accounts for roughly one-fifth of crypto builders' focus, with Layer 1 and Layer 2 projects making up over a third of that slice. Most of these projects are single-mindedly focused on delivering high transaction speeds at reasonable fees. In essence, scalability and process efficiency are still major bottlenecks in the industry.

But let's not get hung up on just the number of transactions per second. Delivering the highest TPS isn't an end in itself. It's a means to an end: a better user experience. In the areas where Web3 is going big - namely trading and gaming - snappy settlement times aren't a luxury. They're a requirement to compete with Web2 incumbents like Robinhood and Fidelity.

Trading Takes Flight in DeFi

The demand for on-chain trading is soaring. According to a16z's State of Crypto report, decentralized exchanges (DEXs) now handle 10% of total spot crypto trading - a stark contrast from four years ago when centralized exchanges (CEXs) commanded 100% of the market.

Meanwhile, the total value locked (TVL) in DeFi has climbed back above $100 billion for the first time since 2021, with analysts predicting continuous growth, with DeFi expected to grow at a jaw-dropping 45% CAGR through 2032[1]. The market is finally recognizing the advantages of transparent, peer-to-peer trading over the black-box mystery of centralized systems.

But Web3 isn't alone. Legacy finance isn't standing pat, either. If on-chain trading platforms want to snag users away from TradFi, they've got to match speed, user experience, and reliability with platforms like Robinhood or Fidelity. The truth is that blockchain will never be able to match TradFi's centralized servers in pure speed - physics, latency, and decentralization make that impossible. But that's not where Web3 triumphs. Its edge isn't measured in milliseconds; it's measured in trustlessness, finality, and programmable finance - things that legacy systems just can't offer.

The real battle ain't just about how fast transactions can be executed; it's about how much trust, efficiency, and flexibility Web3 can infuse into the financial stack. On-chain trading ain't about wiping out TradFi. It's about constructing a financial system where finality is instant, markets are open, and speed serves trust, not intermediaries.

Game Developers Building Their own Pipes

While gaming has caught some attention, from Axie Infinity's early surge to NBA Top Shot's collectibles craze, long-term adoption remains elusive. This year, Ton has emerged as a gaming hub, with viral hits like Hamster Kombat, Notion, and Catizen[2]. These trends suggest that blockchain can add new layers of ownership and economic incentives to gaming, but viral success doesn't guarantee sustainability.

The real opportunity lies in instant asset settlement, true player ownership, and permissionless economies. But, for Web3 gaming to thrive, it needs infrastructure tailored for high-speed, low-cost transactions at scale. If transaction delays or high fees interrupt gameplay, Web3 gaming risks becoming a novelty rather than a revolution - a niche experiment instead of a fundamental shift in the industry.

Unlike DeFi and on-chain trading, which have seen institutional backing, blockchain gaming is still in its infancy. Developers face a different set of challenges: while traders may tolerate some transaction costs, gamers won't. If fees and latency clog up gameplay, blockchain titles can't compete with the sleekness of traditional games. That's why some studios have taken matters into their own hands, building their own chains - like Sky Mavis with Ronin or Dapper Labs with Flow[2].

This signals an unmet need: Web3 gaming requires infrastructure catering to high-speed, low-cost transactions at scale. Instead of making developers solve these problems solo, the industry must deliver blockchains as invisible and powerful as a magic wand. After all, game creators should be dreaming up immersive experiences, not architecting new networks from scratch.

The Urgent Need for Lightning-Fast Blockchains

If blockchain is to make it big in high-demand use cases like on-chain trading and gaming, the industry needs seriously scalable, lightning-fast networks capable of matching Web2's silky-smooth experience. Solana's rise reveals the demand for speedy, cheap block space, but its struggles with uptime highlight the challenge of achieving scalable speed without compromise. Even Ethereum's Layer 2 solutions, while improving speed and cost efficiency, bring their own set of issues - interoperability and fragmentation chief among them[3].

The direction is correct, but the clock is a-tickin'. Blockchain infrastructure needs to evolve fast enough to deliver on Web3's promises before Web2 incumbents swallow up its bright ideas and patent them. Speed is crucial, but it ain't enough. The real goal isn't just to replicate Web2's performance; it's to construct a trustless, open, and composable foundation that Web2 can't touch.

Author Bio

Tristan Dickinson is the Chief Marketing Officer at exSat Network, a docking layer for Bitcoin. A dynamic and visionary marketing exec, Tristan brings a wealth of experience from the banking, financial services, Web3, and technology sectors.

Assets:1. [1] "State of the Network Report Q4 2021 | Near Protocol"2. [2] "Ton Blockchain: The Rising Hub for Web3 Gaming?"3. [3] "Scalability Solutions on Ethereum and Layer 2 Projects"4. [4] "Kaanch: Revolutionizing Blockchain with AI-Powered Smart Contracts"

The need for lightning-fast blockchains is urgent, especially in high-demand use cases like on-chain trading and gaming, as seen in the rising popularity of DeFi and blockchain gaming.
Infrastructure development for blockchain technology is crucial, with scalability and process efficiency being major bottlenecks in the industry, according to a16z's Builder Energy Dashboard.
Ethereum's Layer 2 solutions, while promising to improve speed and cost efficiency, come with challenges such as interoperability and fragmentation.
To build a trustless, open, and composable foundation that can challenge Web2 incumbents, blockchain infrastructure needs to evolve quickly enough to deliver on Web3's promises before these ideas are patented by Web2.