LayerZero’s breakthrough could redefine the efficiency and scalability of blockchain for future systems.
Key takeaways
- The scalability of blockchain is mainly limited by the storage layer.
- LayerZero achieved 3,000,000 updates per second with its storage layer innovation.
- The inefficiency of the blockchain comes from the fact that the nodes reproduce the same calculation.
- Zero can scale up to 2,000,000 transactions per second at very low cost.
- Current blockchain solutions face a trade-off between centralization and scalability.
- Future blockchain systems should aim for millions of nodes and transactions per second.
- MPT’s transition to log-based databases significantly improves performance.
- Generating proofs for transactions increases node efficiency without full computation.
- The evolution of institutions toward centralized systems undermines decentralized technological value.
- LayerZero’s architecture allows small nodes to operate without trusting larger ones.
- Today, most smart contracts are not set in stone and emphasize true adoption rather than technology.
- Institutions are moving from proof of concept to actually creating systems in blockchain.
Guest presentation
Bryan Pellegrino is the co-founder and CEO of LayerZero Labs. He co-founded the company in 2021 with academic collaborators Ryan Zarick and Caleb Banister to solve blockchain interoperability through an omnidirectional messaging protocol. Under his leadership, LayerZero Labs developed the Zero Blockchain, achieving 2 million transactions per second per node without sacrificing decentralization, and entered into partnerships with Citadel Securities, DTCC and ICE.
The storage layer as a scalability constraint
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The storage layer is one of the main binding things like almost all chains
-Bryan Pellegrino
- Blockchain scalability is greatly affected by storage limitations.
- LayerZero’s storage innovation enables 3,000,000 updates per second.
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Once we had this original overview of qmdb, we created this storage layer
-Bryan Pellegrino
- Efficient storage solutions are crucial to improving blockchain performance.
- Storage constraints affect transaction throughput and overall network efficiency.
- Solving storage issues can lead to significant advancements in blockchain scalability.
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It’s like the storage layer is one of the main constraining things, like almost all chains.
-Bryan Pellegrino
Blockchain Inefficiencies and Scalability Solutions
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The main problem with any blockchain today is that if you have a million nodes, each of those million nodes reproduces the exact same calculation.
-Bryan Pellegrino
- Blockchain inefficiencies come from redundant calculations between nodes.
- Zero can perform up to 2,000,000 transactions per second at minimal cost.
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The peak of these four is actually 2,000,000 scalable up to 2,000,000 transactions per second per area.
-Bryan Pellegrino
- Efficient compute strategies are essential for cost-effective scalability.
- Reducing redundant calculations can significantly reduce blockchain operational costs.
- Scalability solutions must address both transaction speed and cost efficiency.
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You are effectively paying a million times the cost of the calculation itself
-Bryan Pellegrino
Centralization vs. Decentralization in Blockchain
- Current blockchain solutions often face a trade-off between centralization and scalability.
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The real premise of the original, as in the beginning, was that nothing can evolve at the moment.
-Bryan Pellegrino
- Increased centralization in blockchain development is seen as limiting.
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We believe that in recent years we have continued to promote an increasingly aggressive centralized roadmap.
-Bryan Pellegrino
- Future blockchain systems should aim for millions of nodes and transactions per second.
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We think what we’re interested in… is scalable to tens of thousands, hundreds of thousands, even millions of nodes.
-Bryan Pellegrino
- Finding the balance between decentralization and performance is a major challenge in blockchain technology.
- Trends toward centralization could undermine the core values of blockchain.
Database Structures and Blockchain Performance
- MPT’s transition to log-based databases improves verifiable database performance.
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The first was qmdb, which is actually an article we published a year ago.
-Bryan Pellegrino
- The Aptos blockchain can perform up to one million transactions per second on a single node.
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We published our Fafsa article which shows that you can get a million transactions per second on a single node.
-Bryan Pellegrino
- Efficient database structures are crucial to improving the speed of blockchain transactions.
- Verifiable databases play an important role in blockchain scalability.
- Improvements to database structures can result in significant performance improvements.
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This is… 100x better performance than the state of the art in database structure
-Bryan Pellegrino
The role of evidence in validating transactions
- Generating proofs for transactions increases node efficiency without full computation.
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Instead, you’ll run this calculation once you’ve generated a proof, and then all nodes in the network just need to validate the proof.
-Bryan Pellegrino
- Proofs allow nodes to efficiently validate transactions, thereby improving network performance.
- Efficient transaction validation is crucial for scalable blockchain systems.
- Evidence-based validation reduces the computational load on blockchain nodes.
- This approach can significantly improve the scalability of blockchain networks.
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Check the proof is that you know actually free compared to the calculation itself
-Bryan Pellegrino
- Proofs play a vital role in improving the efficiency and scalability of blockchain.
Institutional trends and blockchain centralization
- The evolution of institutions toward centralized systems undermines decentralized technological value.
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The only reason we got here is because the whole value of all the technology was in the underlying principles.
-Bryan Pellegrino
- Institutions are moving from proof of concept to actually creating systems in blockchain.
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I think the recent change in administration and everything that’s happened regarding the upcoming Space Clarity Bill
-Bryan Pellegrino
- Trends toward centralization could conflict with the fundamentals of blockchain.
- Institutional adoption of blockchain technology is moving toward practical applications.
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Now we have these systems in this demand that nothing else can meet
-Bryan Pellegrino
- The evolution of institutional engagement is reshaping the blockchain landscape.
Decentralized architecture and network integrity
- LayerZero’s architecture allows small nodes to operate without trusting larger ones.
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But small nodes don’t need to trust big nodes
-Bryan Pellegrino
- Larger nodes should not be able to create fake data or transactions.
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You absolutely don’t want all of this to live in chain
-Bryan Pellegrino
- Ensuring data integrity is crucial to maintaining network security.
- The decentralized architecture improves the security and reliability of the blockchain.
- This approach supports a more secure and decentralized blockchain network.
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Everyone should be able to check exactly what happened in the network status
-Bryan Pellegrino
Smart contracts and real adoption
- Today, most smart contracts are not set in stone and emphasize true adoption rather than technology.
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Most contracts are now not immutable, almost everything built today is scalable
-Bryan Pellegrino
- The focus should be on actual adoption rather than just technological advancements.
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You have to build and adhere to the principles, and then you have to actually get real adoption.
-Bryan Pellegrino
- A focus on practical applications is crucial for the success of blockchain technology.
- True adoption requires a focus on practical, scalable solutions.
- The smart contract approach is moving towards practical use.
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Almost everything built today is scalable
-Bryan Pellegrino
Market fit and collaboration with financial institutions
- Cryptography is product-market fit primarily in marketplaces, payments, and smart contract development.
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We currently consider these to be the biggest problems in crypto.
-Bryan Pellegrino
- Collaboration with major financial institutions is crucial for future global markets.
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We went to dtcc which has $100,000,000,000,000 in assets and processes $4 quadrillion per year in volume.
-Bryan Pellegrino
- Blockchain technology could eventually support systems like the NYSE.
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You could build Nyse on a blockchain
-Bryan Pellegrino
- Partnering with established financial entities is essential for market evolution.
- The potential of blockchain to transform financial infrastructures is significant.
LayerZero Strategic Approach and Market Dominance
- LayerZero has achieved significant market share and volume through strategic partnerships.
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If you look at the success, then now LEGO Zero, you know 82 85% market share
-Bryan Pellegrino
- The focus should be on creating meaningful technology rather than token incentives.
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We are not launching a new token, it is a piece of technology.
-Bryan Pellegrino
- LayerZero is focused on building systems that drive true adoption.
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We care about real systems that will drive adoption
-Bryan Pellegrino
- Strategic partnerships play a crucial role in LayerZero’s business success.
- Focusing on technology rather than token hype is the key to long-term success.
Focus on technology over investment speeches
- The focus should be on technology rather than the investment cycle.
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I don’t want you to think about it… it’s really about the technology itself.
-Bryan Pellegrino
- Prioritizing technological progress is crucial for blockchain development.
- Traditional investment narratives should not overshadow technological innovation.
- The focus on technology aligns with LayerZero’s strategic vision.
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It’s the only thing that matters to us
-Bryan Pellegrino
- This approach supports a sustainable and innovation-driven blockchain ecosystem.
- LayerZero’s strategy reflects a commitment to technological excellence.
