Networking as a scalability bottleneck

While various offchain methods have been developed and are being actively worked upon to scaleblockchains. they face a couple of disadvantages today which include the requirement that partiesremain online to ensure that the other party plays fair (or pay a third-party to monitor the same)arge amounts of locked capital, formation of hubs leading to centralization of routing nodes. fevroutes for high value transactions etc. Moreover. off-chain scaling solutions usually rely on on-chaindispute resolution mechanisms. This means that the dispute resolution mechanism is limited byon-chain throughput - it can be saturated with disputes thereby necessarily letting some disputesgo unresolved in favour of an attacker. The higher the throughput of the base chain, the tougherand costlier it is to perform a successful attack of this kind. Throughput. Throughput in the context of blockchains is the number of transactions per seconda blockchain can support (referred to as tps).

Throughput = #Transactions/Block x #Blocks/second

We essentially have two pathways to scale on-chain - increase the block size or increase the blockrate.