Ethereum has a problem that’s hard to ignore: it can’t support many users right now.

But while these limits were once a potential problem discussed by researchers, they’re now affecting real users. The world’s second-largest blockchain platform has recently seen a slew of capacity issues, including rising smart contract fees that occasionally bog down transaction times and interrupt new ICO launches.

That’s not to say there haven’t been high-profile projects to attempt solutions – sharding, Raiden Network and Truebit have all emerged as innovative ways to ensure future decentralized applications run as easily as the centralized ones we use today.

But a new solution called Plasma, unveiled Wednesday, is quickly emerging as perhaps the project to watch.

That’s because its authors – Vitalik Buterin and Joseph Poon – have blockchain resumes that are hard to beat. Not only is Buterin the creator of ethereum, but Poon co-authored the Lightning Network white paper, which set the roadmap for the technology widely touted as bitcoin’s best shot for increasing its number of users.

Together, the two are a powerhouse pair to have working on a scalability project.

Poon told CoinDesk:

“People say you can’t run everything in the world on the blockchain, but I really, really think it’s possible.”

He believes wholeheartedly in ethereum’s mission of becoming a world computer that “replaces server farms,” and has no doubt that its scaling hurdles will be overcome.

“This decentralized application stuff has looked like hype to really technical people, because there wasn’t a clear trajectory and a path showing how it’s achievable,” Poon said.

But now, with Plasma, he believes there is.

Baby blockchains

The short version of the scalability problem is this: To check ethereum’s history, users need to keep a copy of the entire blockchain, their own complete record of the history of transactions and computations. But, a “world computer” would need a huge trove of data, one most users clearly wouldn’t be able to store on devices today.

As such, ethereum and other public blockchains are looking for ways to reduce the amount of data that’s stored directly on the chain.

Plasma looks to accomplish this through the use of many, baby blockchains.

The system connects “child” blockchains to the “main” blockchain with something called “fraud proofs.” It’s similar to the Lightning Network, an idea Poon put forth a couple years ago for bitcoin, in that it’s a top-layer interacting with a core blockchain below.

While the Lightning Network was limited to work strictly for payments, Plasma extends the idea to more complex computations, like ethereum smart contracts.

“Basically you want to do some mathematical operation; let’s say it’s really complicated and it takes a long time to do, and you ask someone else to do it for you,” Poon said.

At that point, someone puts up a solution with a monetary “bond” of sorts, say $10, arguing that the solution is correct. Users don’t just trust that the solution is correct, there are checks and balances.

“Anyone else in the world can say, ‘No, you screwed up here, at step seven,'” he explained.

If the challenger provides proof that the initial solution is wrong, others can compute it and identify the error. Plus, users have the option to kick the computation back to the “main” blockchain if they suspect fraud, settling the debate once and for all.

According to Poon, because all participants know they can be caught and penalized, they’ll be unlikely to try and defraud the system.

Criticism remains

Some are skeptical, however. The technical idea behind these systems has been extensively discussed in blockchain communities, and has attracted both adamant supporters and obstinate rivals.

Every public blockchain protocol will eventually butt up against scaling limits. Bitcoin, the most-used blockchain today, was the first to show signs of scaling problems, with seemingly endless debate following after. 

But, long-time critics argue that ethereum’s scalability problems are more pronounced since it needs to store so much data to become the dreamed of “world computer.”

On the subject of Plasma in particular, Vlad Zamfir, ethereum’s proof-of-stake research lead, has offered some critical commentary already. He tweeted yesterday that he’s “honestly not excited” about the project, arguing that he abandoned a similar project in 2015.

Poon, though, doesn’t seem phased by Zamfir’s pessimism. And Buterin doesn’t either, clarifying that Plasma is complementary to ethereum’s current scaling work: sharding, which looks to boost capacity at the base layer of the protocol.

Still, Poon admitted there’s a long way to go. Taking the idea to production will take “a lot of testing.” Again he compared Plasma to Lightning, which has made huge strides in the past couple years, but is still incomplete.

Optimism, though, remains Poon’s strong suit:

“I think that it will show that this stuff is really possible.”

Plasma ball image via Shutterstock