Yellow Network’s P2P Solution Aims to Fix Blockchain Scalability Issues

Introduction: The Missing Layer in Web3 Infrastructure

Blockchain technology has achieved remarkable adoption, with governments and financial institutions increasingly recognizing its transformative potential. Yet despite this progress, fundamental challenges around speed, scalability, and decentralization continue to hinder mainstream implementation. The computing capacity of even the most advanced blockchain networks struggles to meet global demands, creating a critical bottleneck for Web3 applications.

In a revealing interview with crypto.news, Alexis Sirkia, Captain of Yellow Network, outlined how peer-to-peer transactions could solve the scalability problem that continues to plague blockchain ecosystems. Sirkia's perspective comes at a pivotal moment when the industry recognizes that current blockchain architectures cannot support worldwide adoption without significant infrastructure improvements.

What makes Yellow Network's approach particularly compelling is its focus on building what Sirkia describes as "a missing layer in Web3 infrastructure" – a trustless peer-to-peer communication system that reduces blockchain overhead without compromising security. With over 70 applications already utilizing Yellow's SDK on testnet and mainnet launch approaching, this solution represents one of the most practical attempts to address blockchain's fundamental limitations.

The Promise of Trustlessness: Web3's Core Advantage

According to Sirkia, the primary benefit of Web3 and DeFi compared to traditional systems lies in "this idea of trustlessness, which is a system where you don't need to rely on human intermediaries." This fundamental shift represents what decentralized architectures like Bitcoin and Ethereum introduced – the ability to build applications that automate processes previously controlled by centralized entities.

"With Web3, you can have autonomous entities, meaning smart contracts or DAOs, controlling business logic, not people," Sirkia explained. "That's powerful. Think of companies that don't depend on human oversight. They run autonomously, efficiently, and without risks of corruption, insider trading, or biased decision-making."

This vision extends beyond financial applications to encompass broader business operations. Sirkia pointed to platforms like Amazon as examples where centralized intermediaries currently provide trust services. "A buyer purchases from a seller, and Amazon ensures the transaction happens smoothly — it acts as an intermediary. But with Web3, that role can be replaced by a smart contract."

The key distinction lies in automation versus human adaptability. "Computers aren't corruptible. If I have to choose between people and math, I'll choose math," Sirkia noted, while acknowledging that "smart contracts aren't as flexible as humans" when dealing with nuanced real-world scenarios like supply chain disruptions or exceptional circumstances.

Web3's Infrastructure Gap: Where We Are Today

Sirkia places current Web3 development at a stage comparable to artificial intelligence in the year 2000. "The concept of AI had been around since the 1960s, but by 2000, the infrastructure wasn't quite ready. The tools were there, but the computing power and platforms weren't widely available."

This historical parallel highlights how foundational technologies often require decades to mature before achieving widespread practical application. The term "Web3" itself was only coined in 2014 by Gavin Wood, making the ecosystem relatively young in technological terms.

"Web3 is in a similar place now," Sirkia observed. "What we've done with Yellow is part of this missing infrastructure. And now, with Bitcoin, Ethereum, and Yellow, we finally have a nearly complete foundation to build the next generation of autonomous, decentralized applications."

This perspective suggests that while blockchain technology has captured public imagination, the underlying infrastructure necessary for mass adoption has remained incomplete until recently.

Yellow Network's Solution: Trustless Peer-to-Peer Communication

The core innovation Yellow Network brings to the Web3 stack addresses a specific gap in existing infrastructure. "With Bitcoin and Ethereum, we had the beginning of trustless infrastructure — systems that removed the need for intermediaries in transactions involving three or more parties," Sirkia explained.

However, what remained missing was "trustless peer-to-peer communication — direct, cryptographically secure interactions between two parties without relying on centralized servers or full blockchain verification for every step." This represents the layer Yellow Network has built, enabling two systems or individuals to conduct business directly without constant third-party supervision.

Sirkia used a retail analogy to illustrate the concept: "In the real world, most business happens directly between parties. You go to a store, pick up some items, and only at the end do you pay — that's when the system settles. The tax authority, for example, doesn't care about every apple or orange you pick up, just the final bill and taxes owed."

Current blockchain systems lack this efficiency. "Web3, up until now, was missing that dynamic. Instead, we had 30,000 validators verifying every single step — every action and handshake — when really, that level of oversight is unnecessary for most interactions."

Technical Implementation: State Channels and Cryptographic Proofs

Yellow Network's solution utilizes state channels – similar to Bitcoin's Lightning Network but designed for Ethereum and other smart contract platforms. "Two parties open a channel between them, agree on a set of transactions, and cryptographically sign each one off-chain," Sirkia described.

The process enables multiple transactions between parties with only final settlement occurring on-chain. "You and I could agree to trade a bitcoin for $100,000, then another trade — say, Ethereum for $4,000 — and each step is signed. Only when we want to settle do we involve the blockchain."

The dispute resolution mechanism relies on cryptographic proofs rather than human judgment. "Every transaction in the state channel is signed cryptographically by both parties and contains a reference to the previous one, much like a mini blockchain. So each new transaction forms a chain that builds on the last — and the newest one always wins."

This approach ensures that if disputes arise, "the smart contract simply checks which party has the most recent signed proof. That version is considered valid. The logic and rules for resolution are already coded into the smart contract in advance."

Scalability Benefits: Beyond Blockchain Limitations

The practical advantages of Yellow Network's approach become clear when examining current blockchain limitations. Sirkia provided a striking comparison: "The entire Solana network today has less computational capacity than a 1984 Intel processor, or a DEC VAX system from the 1970s. I'm not exaggerating — those machines had one million instructions per second. That's more than Solana currently delivers."

This limitation isn't necessarily a design flaw but rather reflects blockchain's fundamental purpose. "It's not that blockchain is a bad system — it's just not meant to run an entire app. You need it for consensus, settlement, and arbitration — but the heavy lifting should happen off-chain."

By shifting most transactions to peer-to-peer layers while maintaining blockchain for critical functions like final settlement and dispute resolution, Yellow Network achieves significantly better performance. "We're trading at the speed of light — peer-to-peer, no global consensus required. It's like having a local blockchain just between two parties, and it's far more scalable than anything happening fully on-chain."

Real-World Applications: Beyond Theoretical Potential

While Yellow Network initially developed its technology for trading applications through platforms like NADAs broker and NLAX protocol, unexpected use cases have emerged as developers gained access to the Yellow SDK.

Sirkia highlighted several examples from recent hackathons and developer events: "We've seen payments apps, trading apps, games — everything from Tinder-style trading interfaces to multiplayer Tetris, and even a real-time Snake game between two players." The diversity of applications demonstrates the flexibility of Yellow's underlying technology.

Perhaps more significantly, real-world implementations are already occurring even before mainnet launch. "We even saw this tech used at a real-world rave in Ukraine. A payments app built on Yellow allowed people to instantly pay for drinks and items at the event. There was no waiting for confirmations — it was just fast, cryptographic payments."

The speed of development has surprised even Yellow Network's team. "At Korea Blockchain Week, we saw someone demoing an app they built on Yellow just weeks earlier at a hackathon in Europe. That was surreal — the ecosystem is already moving ahead of us."

Historical Context: Parallels with Earlier Technological Shifts

Sirkia sees strong parallels between current developments in Web3 infrastructure and earlier technological revolutions. His personal experience with Ethereum's early days informs this perspective: "It reminds me of when Vitalik was first launching Ethereum. Back then, people didn't really understand what it was for. I actually got in during the presale — bought 20,000 ETH at 27 cents."

This pattern of initial skepticism followed by gradual understanding and eventual widespread adoption has characterized multiple technological shifts. "When Bitcoin started, barely anyone understood what it really meant," Sirkia recalled. "I had a banker tell me that I should be careful because this was illegal. That was the perception: that it was dangerous, criminal, fringe."

The same pattern repeated with Ethereum's emergence. "Most Bitcoin people didn't get it. There were maximalists — obsessed with sound money, but blind to the broader concept of trustlessness. They couldn't see that the same principles could apply not just to money, but to contracts, businesses, and apps."

According to Sirkia, we're experiencing a similar transitional period today. "Most people don't understand that the concept of Ethereum — programmable trust — can be extended one layer deeper into peer-to-peer systems, where two people can do business directly, without any trust, without relying on a global consensus for every step."

Conclusion: The Path Toward Scalable Web3 Infrastructure

Yellow Network's peer-to-peer solution represents a significant step toward resolving blockchain's scalability trilemma – the challenge of achieving decentralization, security, and scalability simultaneously. By creating a trustless communication layer that operates alongside rather than replacing existing blockchains, this approach maintains security guarantees while dramatically improving transaction throughput.

The timing appears strategic as Web3 applications face increasing pressure to demonstrate practical utility beyond theoretical potential. With over 70 applications already building on Yellow's testnet SDK and mainnet launch imminent,the infrastructure appears poised for rapid adoption across multiple use cases including trading,gaming,and real-world payments.

For developers and industry observers,the emergence of robust peer-to-peer layers signals maturation in Web3's technological stack.As Sirkia noted,the combination of Bitcoin,Ethereum,and complementary technologies like Yellow Network creates"a nearly complete foundation"for decentralized applications.This suggests we may be approaching an inflection point where Web3 transitions from experimental technology to practical infrastructure capable of supporting mainstream applications.

The broader implication extends beyond technical specifications toward fundamental shifts in how digital interactions occur.Much as early internet protocols enabled global information exchange,Yellow Network's approach could facilitate trustless peer-to-peer value exchange at scale-potentially transforming how businesses and individuals transact across digital environments.As mainnet launch approaches,the industry will watch closely whether this theoretical potential translates into tangible improvements in user experience and application performance.The success or failure of such infrastructure projects may well determine whether Web3 achieves its promise of creating more open,efficient,and decentralized digital ecosystems