Why Bitcoin Has a Scalability Problem?


Scalability is the most crucial aspect of any technology that should be taken into account before the actual deployment of technology. Yet, even after the successful deployment of an application, the application would be required to update frequently in order to remain scalable.


Bitcoin scalability is one of the greatest concerns that hinder too many retail investors and organizations from invading into the bitcoin. In this short and brief article on blockchain scalability, I’ll try to address all the core aspects of bitcoin scalability.


Definition of Scalability


Satoshi has invented the most prominent cryptocurrency that has stopped the reliant on the central regulatory agency for the successful transaction. Scalability has always been the greatest concern with bitcoin that remains unaddressed. There are quite a few numbers of transactions bitcoin can execute. This problem is regarded as scalability. The average number of transactions that the bitcoin can handle is 3-5 transactions per second whereas the Visa card can handle millions of transactions per second. The issue of scaling has disappointed too many early adopters of blockchain technology as the demand for the blockchain technology has grown dramatically in the past few years. Owing to the concerns related to the scalability of bitcoin, it cannot be leveraged as a medium of transactions globally.



Impact of Bitcoin Scalability

Bitcoin uses proof of work algorithm to verify the transaction, and this transaction is then embedded to the bitcoin block. This process is known as mining. The transaction detail is stored in an immutable block created by a cryptographic hash function algorithm. The maximum size of the block that was created up until now is 2MB. The small size node of the bitcoin ecosystem makes the bitcoin ecosystem more decentralized and secure.


According to the study revealed by the Tata communications in 2018, around 44% of organizations are harnessing the potential of bitcoin. From an architectural perspective, scalability is the greatest concern that hinders bitcoin widespread adaptability. Deloitte demystifies this issue in these words:


“Bitcoin sluggish transaction process system is the greatest concerns for those enterprises that solely rely on the high-performing legacy transaction processing system”  

Increasing the bitcoin block transaction size and reducing the block generating time by removing the cryptographic hash function complexity isn’t enough to achieve scalability in bitcoin. The two of the aforementioned methods can be deployed to compete with the global businesses that are considered as the giant of internet-based transactions like Visa that can handle an average of 150 million transactions per day.


The time utilized by the bitcoin to complete the transaction is extremely slow. Currently, the size of each block that can handle the complete track record of the transaction is 1 MB. By implementing the SegWit methodology, the average block size can be enhanced up to 4MB. Currently, the bitcoin block generation time is 10 minutes that means after 10 minutes a new bitcoin block is mined and is added into the bitcoin ecosystem. The maximum number of transactions that Bitcoin can handle each second is 4.6 that demonstrates bitcoin cannot be used as a medium of transaction globally unless the culmination of some serious efforts has been put in by some crypto experts to resolve this issue.





Scalability is one of the greatest concerns with bitcoin that remains unaddressed. To be honest, to say, bitcoin scalability issue refrain large organization to harness the true potential of the blockchain-based peer-to-peer electronic cash transfer system.