Not Everything Is Better On-Chain

HodlX Guest Post  Submit Your Post

A number of on-chain transactions are at times volatile, which could also be impacted by investors selling.

Analysts are suggesting a reevaluation in price or a drastic increase in on-chain activity to rectify the metric.

However, what we are witnessing is yet another implication of a model which leans heavily on on-chain activity.

Going off-chain means that businesses can leverage existing technology stacks for more user adoption.

It would lower the entry barrier for users who are concerned about transaction fees on certain chains but still exhibit trust in the unique capabilities and reliabilities of that particular network.

For businesses, it could enhance flexible adaptive requirements that occur in the process of technology development compared to using a fully on-chain code base.

While for vendors or partners, it can help build a standard of how software engineering shall be communicated within the same framework.

Having on-chain and off-chain capabilities enhances the potential

Part of Web 3.0’s conviction is how it removes the middleman from the equation – but how speedy, costly and flexible has this been for users?

Yes, there’s end-to-end encryption with security and transparency, but conducting transactions on-chain has also added a lot of complications.

For example, if the volume of transactions is high, network fees rise and each transaction incurs gas fees, which do not come cheap.

The luxury of linking fiat currency to crypto, for example, makes trading decisions easier and the point of entry less obscure.

Doing business off-chain enhances use cases of off-chain data and encourages the rise of more innovative products and services in a number of industries, including insurance, carbon emission credit, entertainment and more.

The speed of transferring from one wallet to another, for example, could also take hours before the sender can rest assured that it went to the right account.

Transactions conducted off-chain, on the other hand, are processed almost instantaneously, eliminating the anxiety of it showing up later and the exorbitant prices that come with on-chain.

As long as admission to Web 3.0 comes at such a hefty fee, arguments about accessibility will remain contradictory.

For commercial businesses, agility and flexibility is non-negotiable when it comes to design.

There are, in fact, a lot more opportunities for creativity and innovation when businesses have the option to link…