Blockchain is revolutionizing the Multi-Level Marketing (MLM) industry into a trustless, secure, efficient, and hack-proof ecosystem. Businesses are leveraging ready-made smart contract MLM script to quickly launch their MLM projects into the market to gain a competitive edge. However, the question that looms is that why has every MLM player not moved on to blockchain. The fact is that smart contract supporting the Ethereum blockchain started facing challenges like high transaction fees and slow transaction speed. The Ethereum developers have been trying hard to overcome these scalability challenges.
Interestingly, Ethereum 2.0 or Serenity is the major upgrade that will enhance the functionality and performance of Ethereum in different ways.
Ethereum developers have introduced two major improvements to Ethereum 2.0 that did not exist in Ethereum 1.0. These are the shift from Proof of Work to Proof of Stake and introduction of Shard Chains.
• Security and Scalability
With the move to Ethereum 2.0, the blockchain will shift its consensus mechanism from Proof of Work to Proof of Stake. With that happening, the security and scalability of Ethereum blockchain will improve drastically. Effectively, the blockchain MLM platforms, including smart contract MLM script, will be able to support the growth spruce that an MLM generally experiences. The transactions like commission payouts won’t be stalled due to network congestion.
By moving to PoS consensus, the Ethereum blockchain will become more secure. That’s because the network will become truly centralized which means the transaction on Ethereum based MLM platforms will become even more secure.
Sharding or shard chain is basically a mechanism to enhance the scalability of the blockchain. With shard chains, Ethereum 2.0 is expected to deliver massive throughput unlike Ethereum 1.0.
Currently, Ethereum 1.0 requires a full node to process and validate the transaction. However, this limits the number of nodes available when there are more transactions. Effectively, when transaction-sensitive platform like MLM operates on Ethereum 1.0, they might face clogged and slow networks. With Ethereum 2.0, the blockchain will be able to process 10,000 transactions per second whereas currently, it is able to process only 30 transactions per second.
With shard chains, Ethereum 2.0 will actually split the blockchain. As a result, the data processing tasks are shared by multiple nodes. This results in parallel processing of transactions and enhances the throughput of the blockchain and solutions built on top of it drastically.
Key Advantages of Ethereum 2.0 powered smart contract MLMs are:
With the movement from proof of work to proof of stake consensus, the network will become truly decentralized. As a result, there will be no central authority like miners who can control or manipulate the network. Effectively, the smart contract MLM script running on the new Ethereum blockchain will enjoy complete decentralization and higher security.
• Transaction automation
The traditional MLM software is capable of transaction automation but it can be manipulated as these solutions are centralized. With the use of smart contracts, all the transactions on an MLM platform like sign up processes, commission distribution, and more can be automated. Interestingly, once the smart contract is set up no one can change its terms – whether it’s the platform operator or the network participant.
• High-end security
Ethereum 2.0 will be a proof of stake consensus blockchain that will establish itself as a truly decentralized network. This will effectively make the network more secure and the applications running on it even more secure.
• Timely commission payouts and higher trust
The traditional MLM software are glitchy. Most of the times, the commission payouts are delayed and this directly affects the trust of network participants. Smart contract based MLM software are free of these challenges. That’s because the smart contracts once designed to make the commission payouts on a certain date or because of some event will happen without a failure.
The prime benefit of using smart contract based MLM platform is that it eliminates all the third parties in the network marketing business model. Primarily, it moves the MLM business model to peer-to-peer transactions, eliminating the involvement of third parties.
Antier Solutions, is one of the leading digital assets management solutions provider. We have been helping entrepreneurs launch their smart contracts powered MLM platforms. Driven by a team of 150+ blockchain experts, we enable business owners with MLM platforms powered by TRON, Ethereum, and Bitcoin.