Nation-ready scalability research

No blockchain has achieved the scalability required for nation-scale adoption. Cardano has a lot of exciting novel scalability solutions in the works such as the Hydra research project by IOG. However, Hydra has some limitations for its initial versions -- one of which is that it only works with a fixed set of people and users have to be online 24/7 to use it. Although this has uses, it is different from the usage pattern of nations.

One of the promising research ideas in the blockchain space right now is "rollups". They are a way to scale blockchains that allow creating new networks that use ADA as its base currency and leverage the root of trust of the Cardano mainnet (no new major trust assumptions). We believe rollups can also be part of Cardano's scaling strategy.

R&D into rollups (or any scalability solution in general) tends to be a multi-million dollar budget. That is why we are instead proposing a 75K proposal to do preliminary research on the problem. We believe the deliverables of this research to be:

1. Writeup of a more rigorous analysis of naive rollups

2. Feasibility of rollups on UTXO-based chains (Cardano) and accounting-style chains (such as the sidechain of Cardano called Milkomeda)

The goal is that through this research, we can as a community have an educated decision about whether or not it is worth making subsequent investment into this research track and, if we decide it is a priority, to have a clear roadmap of what changes will be required to make it possible.

We believe we can have this deliverables available in the first half of 2022.