https://www.forbes.com/sites/outofasia/2017/12/22/five-issues-preventing-blockchain-from-going-mainstream-the-insanely-popular-crypto-game-etheremon-is-one-of-them/

Etheremon was just released and it’s already making waves across the crypto community. The game allows you to capture monsters and put them to battle. In less than 24 hours, there have been over 19,000 transactions.

This game clogged up the Ethereum network, slowed down transactions, and caused transaction fees to go through the roof. If crypto assets truly want to move from being a speculative asset to a technology used in our day to day lives, the following five issues need to be addressed: scalability, interoperability, privacy, governance, regulations.

Scalability

Ethereum currently handles 800k transactions per day, while Bitcoin is nearing 500k. The viral success of applications like Etheremon and CryptoKitties resulted in users complaining that their transactions weren’t being processed, or had to pay a much higher transaction fee. The current transaction limit for Ethereum stands at 15 transactions per second.

Etheremon

Etheremon is a decentralized application built on the Ethereum network. It simulates a world of Ether monsters (Etheremon) where you can capture, evolve an Etheremon to defeat others. You catch an Etheremon using your Ether and earn Ether back whenever the same kind of Etheremon is caught by other.

The ecosystem is exploring options to deal with this bottleneck. The Raiden networkwill allow transactions to be handled off-chain at higher speeds. Some of the scaling options for ICOs this year hoping to run their dApps (decentralized applications) on the Ethereum platform may be too late.

Ted Livingston, CEO of mobile messaging startup Kik, which had an ICO for its Kin token network earlier this year stated they would abandon Ethereum for a different blockchain technology. He went as far as to call Ethereum the dial-up era of cryptocurrency.

The most significant upgrade planned to address scalability for Ethereum is a technology called "sharding"-- a technique which would split the network up into smaller pieces called "shards" to massively improve transaction speeds. Vitalik Buterin, the creator of Ethereum has however stated sharding for Ethereum may be three to five years out.

Enter a new Singapore based blockchain startup called Zilliqa. This new blockchain will be designed with sharding in mind from the get-go. Test results show the network hitting 2,400 transactions per second (TX/S) with ambitions to hit Visa level throughputs of 4,000 TX/S. The team has a partnership with multinational ad agency Mindshare, who want to experiment with the technology.

If the existing top dogs such as Bitcoin and Ethereum can’t find a solution to scaling issues, we will likely see more money flow into projects like these.

Interoperability

Coin Market Cap currently counts 1,360 different cryptocurrencies in existence. As the ecosystem expands, so does the need for these blockchains to be able to communicate with each other.

A number of blockchains launched this year, with interoperability being the key issue they want to solve. Three of these projects (ICON, AION and Wanchain) saw the need for co-operation in the crypto scene and founded the Interoperability Alliance. This alliance will focus on the common goal of connecting blockchain protocols.

ICON aims to interconnect individual blockchains without any extra intermediaries. They will be supported by 5 leading South Korean consortiums, including securities, banks, universities, hospitals and insurance companies.

AION strives to become the common protocol these blockchain use and they signed a deal with defense contractor Moog.

Wanchain will be a distributed financial platform that facilitates the execution of private cross-blockchain smart contracts. They have the closest ties with the Chinese market.

Other projects that aim to connect blockchains include COSMOS and Polkadot, but the latter will only hit the market in two years.

Privacy

The distributed ledger technology most blockchains use allows for full transparency over transactions. For some blockchain applications, it is vital some information can’t be accessed by just anyone.

The NuCypher project wants to give people the ability to safely share encrypted data with other parties. NuCypher integrates with big data platforms, enabling enterprises to shield data from unauthorized access and share data between organizations through cloud computing.

Regulations

Embracing self-regulation is key at the moment. It’s wild west days and many projects are letting anyone invest from anywhere in the world. Ensure transparency and auditability. Don’t skip KYC (know your customer) anti-money laundering regulations. Make sure your utility tokens comply with SEC regulation. Polymath and Tzero will both allow for securities to be traded within a regulatory approved framework.

Governance

Bitcoin forks and proposed hard forks have caused a lot of uncertainty. The Bitcoin community was in a crisis after a debate of three years on improving the scalability of bitcoin. It looked like the leaders were going to upgrade to a 2MB blocksize, but plans were called off to keep the community together.

Young projects may make mistakes on governance, but leaders are taking careful measures. Cypherium has a novel approach to multi-level governance. Changes to the protocol like block size and transaction fees are adjusted by voting. Decred takes a revolutionary approach allowing you to vote with tokens on upgrades to the platform.