Definition
A blockchain's ability to handle increasing transaction volumes without sacrificing speed, security, or decentralization. The 'Blockchain Trilemma' states you can only optimize for two of three: scalability, security, and decentralization.
Why It Matters
Scalability is the biggest challenge in blockchain adoption. High gas fees and slow transactions are symptoms of poor scalability — the driving force behind Layer 2 development.
Example
Bitcoin processes about 7 transactions per second. Visa processes up to 24,000. This scalability gap is why Bitcoin Layer 2 solutions like the Lightning Network exist.
Related Terms
Layer 2
Rollup
Gas Fee
Blockchain