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The Blockchain Killer?

Chris Campbell

Posted August 01, 2022

Chris Campbell

Artificial intelligence. Machine learning. Internet of Things. The space economy. Driverless cars. Genome sequencing. And much more.

There’s a lot of excitement surrounding these technologies.

Futurists have made no shortage of predictions about how they’ll radically transform our world.

But, here’s one thing they barely mention:

All of our major technological innovations are limited by the speed, security, and trustworthiness of the data storage solutions.

This is the big bottleneck.

Blockchains allow us to have trust and transparency without the need of a central authority.

And, make no mistake. This is revolutionary stuff.

But, here’s the harsh truth:

The “traditional” architecture of blockchains can’t scale to meet the data needs of 21st century foundational technologies.

We need a FUNDAMENTAL shift in the architecture, without throwing out the baby with the bathwater.

For this reason, a few crypto teams are turning to a data modeling technique called Directed Acyclic Graph, or acyclic graphs.

Blockchain Killer?

Directed acyclic graph technology is a big deal. Some are even calling it a “blockchain killer.”

Here’s the truth:

Acyclic graphs will be a great complement to blockchain, making it easier for legacy systems to use blockchain technology, and helping crypto reach mass-adoption.

But, contrary to the hype, acyclic graphs won’t kill blockchains.

And, though there are many crypto companies using this technology…

We’ve identified only ONE acyclic graph crypto project that has a shot of hitting mainstream adoption. And, right now, it’s less than 25 cents.

We’ll get to that in a moment.

First things first…

What is an Acyclic Graph?

Simply put, an acyclic graph is a data modeling tool. All software has a specific architecture. Acyclic graphs are just a different way to model data, with its own set of trade-offs.

Blockchains move in a straight line, with blocks of data connected by chains, but acyclic graphs are a series of transactions in a graph.

While blockchain architecture looks like this…

IMG 1

Acyclic graphs look like this…

IMG 2

They are similar in two ways…

Both create immutable ledgers showing agreed-upon information. Both allow users to send, receive, and confirm transactions.

But that’s pretty much where the similarities end.

The biggest difference is how they scale.

Scale Me Up, Scotty

When it comes to scalability, there are two approaches: you can scale up (vertical) or scale out (horizontal).

Vertical scaling improves the efficiency of each transaction. Horizontal scaling increases the entire platform’s capacity.

Traditional blockchains scale vertically.

A good analogy is a busy grocery store with only one checkout aisle. The vertical scaling solution is to train the cashier to be faster at his job (make blocks bigger). The horizontal scaling solution would be to create more and more lanes with more cashiers (utilize Acyclic Graph technology).

Vertical is easier to implement and more secure, but it comes with a lot of limitations.

Horizontal is more complex, but offers scale that far exceeds vertical architectures.

Pros:

→ No miners
→ Instant transactions
→ Micropayments

Cons:

→ Complexity
→ Requires big user-base (traffic is tied to network security)

Again, acyclic graph is not a replacement to blockchain. It is a complement.

Acyclic graph could be a crucial tool for crypto’s mass adoption, but traditional blockchains will work hand-in-hand with them to maintain security.

Our Favorite Acyclic Graph

As mentioned, there are several crypto projects using the directed acyclic graph technology.

James and I have been tracking Acyclic graph technology for a while. But only recently — last week, in fact — did we recommend a crypto company using the Acyclic Graph technology.

For the record, we only recommend cryptos we believe have a chance of making 100X… and even 1,000X gains over the next few years.

We’re looking for BIG asymmetric bets. High risk, higher rewards.

After months of vetting a tiny crypto — now valued at 25 cents — that uses D.A.G technology, we believe it’s one of the best asymmetric bets in crypto.

If you’re not already a member of our flagship crypto research newsletter:

In total, we have 33 crypto recommendations, with a new one (at least one) every single month.

Click here to sign up and check out our full model portfolio.

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