Much debate has centered around the scalability vs elasticity topic regarding blockchains. Today, we delve into what each of these terms means and what they signify for the future of blockchain technology.

No matter the field, you are bound to encounter two or more terms that appear interchangeable. Whether it's because their names are similar or their core meanings are comparable, these seemingly identical terms are common. You can use either one of them and it wouldn’t matter because they are synonymous, right? Wrong.

In business and finances, there is no shortage of fancy terms that you need to understand. There are plenty that appears similar yet contain contrasting definitions. Two of these comparable terms include ‘scalability’ and ‘elasticity’. If you take their most basic definitions, they seem to mean the same - if not almost the same - thing. Scalability focuses on coping with expansion and elasticity equates to sensitivity to changes.

Many use these terms interchangeably, but there are distinct differences between them. Knowing about these differences and understanding them is crucial to ensuring that the needs of a business are met. Next up, we'll highlight the differences that come into play in the scalability vs elasticity debate and what that means for the future of blockchain.

Scalability

‘Scalability’ is among the many key traits of a system, model, or function. It is indicative of that system’s capability to adapt and perform adequately under an increasing or expanding workload or scope. A system that ends up scaling well will be able to maintain or even boost its level of performance or efficiency. This is even while it is undergoing testing by operational demands that grow larger and larger.

In the context of financial markets, scalability refers to financial institutions’ ability to deal with growing market demands. A scalable company in the corporate environment is one that is capable of maintaining or improving profit margins. And this is all while sales volume increases.

This concept has close connections to the term ‘economies of scale’. This is when certain companies are able to cut down their production costs and increase profitability. Specifically, while they are steadily growing larger and producing more. For situations when expanding production leads to an increase in costs and profit decrease, the term is ‘diseconomies of scale’.

Whether it be in the context of finances or within a business strategy context, scalability describes a company's ability to grow. This development of this ability is without any hindrance from its structure or available resources when facing a production increase. The very idea of scalability is gradually becoming more pertinent in recent years. Technology is making it comparatively easier to acquire customers and expand both markets and scale. In this sense, it is no wonder that its relevance is growing.

Elasticity

‘Elasticity’ is a measurement term that applies to a variable's sensitivity to a change in another variable. In most cases, this sensitivity is the difference in price relative to changes in an array of other factors. In the field of business and economics, elasticity is a reference to the degree to which individuals, consumers, or producers modify their demand. Alternatively, when the supplied amount in response to price or income changes. It is primarily a way to evaluate the change in consumer demand mainly due to a change in price. It could be the price of a good or the price of a service.

Generally speaking, elasticity is an economic concept whose primary purpose is measurement. It gauges the change in the aggregate quantity that is demanded for a good or service. Moreover, this measurement is in relation to the price movements of that particular good or service. A product will only be ‘elastic’ if the product’s quantity demand alters drastically whenever its price increases or decreases. In contrast, a product is ‘inelastic’ if the product’s quantity demand experiences very little change whenever its price fluctuates.

If demand for a good or service is rather static - despite the price changes - then the demand is officially inelastic. Furthermore, its coefficient of elasticity ranks less than 1.0. Some notable examples of elastic goods include clothing and electronics. Examples of goods that are inelastic include items such as food and prescription drugs.

Key differences

As can you no doubt tell from the above definitions, there are various factors that separate the two terms. For starters, scalability refers to increasing the capacity to meet the increasing workload. Elasticity, on the other hand, covers increasing or reducing the capacity to meet the increasing or reducing workload.

Scalability, in a scaling environment, pertains to the available resources possibly exceeding to meet the future demands. It only adapts to the workload increase by way of provisioning the resources in an incremental manner. Elasticity, in the elastic environment, pertains to the available resources matching the current demands as closely as they can. It adapts to both the workload increase as well as workload decrease. This is purely by way of provisioning and de-provisioning resources; specifically, in a manner that is autonomic.

When it comes to scalability, serving an increasing workload is with increasing the power of a single computing resource. Alternatively, increasing power through a group of computer resources. In the context of elasticity, serving a varying workload is with dynamic variations in the usage of computer resources.

There is a difference in the end goal of enabling a corporate. For scalability, it enables a corporate to meet expected demands for services with needs that are long-term and strategic. For elasticity, it enables a corporate to meet unexpected changes in the demand for services with needs that are short-term and tactical.

The best way to differentiate these terms is with similes. For scalability, scaling up is an individual increasing their power in order to meet the increasing demands. Scaling out, meanwhile, is constructing a team to meet the growing demands. For elasticity, it’s an actor changing their body weight to meet the numerous demands of the film industry.

Cloud

It is difficult to look up scalability vs elasticity without landing on the connection to ‘cloud computing’. Cloud computing is basically the on-demand availability of computer system resources, pertaining primarily to data storage and computing power. Moreover, without any semblance of direct active management by the user. The use of the term is in relation to the description of data centers available to users across the Internet. Nowadays, large clouds frequently possess functions whose distributions extend over an array of locations from central servers.

The definitions of cloud scalability and elasticity share some similarities with the abovementioned definitions. Cloud scalability is the ability of the system’s infrastructure to handle expanding workload requirements. All while it retains a consistent performance competently. There are various types of cloud scalability:

  • Vertical (aka. Scale-Up): The ability to manage an ever-increasing workload by adding additional resources to the pre-existing infrastructure. It is commonly seen as a short-term solution that covers immediate needs.
  • Horizontal (aka. Scale-Out): The expansion of the current infrastructure. This includes adding new elements that will help tackle more significant workload requirements. Overall, it is a long-term solution that intends on covering present and future resource demands with room for potential growth.
  • Diagonal: A considerably more flexible solution. It effectively combines the addition and removal of resources in accordance with the pre-existing workload requirements. Out of all the scalability solutions, this one is by far the most cost-effective.

Сloud elasticity is a system’s ability to handle available resources corresponding with the current workload requirements dynamically. It is a popular feature with scale-out solutions, which allows for dynamic additions or removals of resources. It is a common feature in pay-per-use or pay-as-you-grow services, meaning IT managers aren’t paying for more resources than they are consuming.

What they provide for the cloud

There are some cloud services that many see as adaptable solutions. Ones that offer their users both scalability and elasticity. These services allow IT departments to expand or contract their resources and services by drawing from their needs. This is all while simultaneously offering pay-as-you-grow to scale for performance and resource needs to meet Service Level Agreements (SLAs). The incorporation of these capabilities is quite an important consideration. This is especially true for IT managers whose infrastructures are experiencing constant alterations.

It is important to not allow yourself to fall into the sales confusion of services. To elaborate, where the presentation of cloud elasticity and scalability by public cloud providers are as the same service.

At the risk of stating the obvious, there are distinct differences between elasticity and scalability. In the end, the best choice depends on the business need or use case. This will help determine whether an elastic service or scalability service is the ideal one.

Blockchain integration

Dinh C. Nguyen, Pubudu N. Pathirana, Ming Ding, and Aruna Seneviratne collaborated to write an essay. Under the name Integration of Blockchain and Cloud of Things: Architecture, Applications, and Challenges, it discusses blockchain’s impact in its abstract. The point of the essay was to highlight a potential union between blockchain and Cloud of Things (CoT).

In this context, blockchain provides innovative solutions to address challenges in Cloud of Things in terms of decentralization, data privacy, and network security, while Cloud of Things offer elasticity and scalability functionalities to improve the efficiency of blockchain operations. Therefore, a novel paradigm of blockchain and Cloud of Things combination, called as the BCoT model, is regarded as a promising enabler for a wide range of applied scenarios.”

Architecture that is centralized is not exactly a practical solution for a decentralized and distributed CoT ecosystem. Especially not an ecosystem with an extremely large number of distributed IoT sensors and devices.

There is a way to achieve sustainable development and long-term adoption of CoT in a variety of applications. That method entails the construction of a more decentralized ecosystem, which many view as a future direction. Thus, the centralized computing schemes with closed data access paradigms will upgrade to open, semi-centralized cloud architectures. These are commonplace and are very useful in many of today’s applications.

Still, there is a prediction that the future generation of IT technology will be open cloud IoT paradigms. Most importantly, they will be decentralized. This will all be possible thanks to innovative blockchain solutions.

Nowadays, blockchain, a secure and transparent system, is making an impact as a technology with a lot of potentials. It will address issues of traditional centralized networks and lead the way for the next generation of CoT technologies.

Noteworthy benefits for the integration

The main benefits that come from CoT supporting blockchain platforms include the following:

  • Scalable support for transactions on the blockchain: When it comes to large-scale blockchain applications, the number of transactions in blockchain networks tend to be large. Therefore, it is imperative to provide powerful data processing services. This will help accelerate transaction execution which, in turn, will facilitate scalable blockchain services. “In this context, the cloud can offer on-demand computing resources for blockchain operations thanks to its elasticity and scalability capability. For example, public clouds can offer a large-scale network of resources for blockchain service operators in a federated cloud environment. Cloud services can help in such cases through the replication of blockchain data over the cooperative network and the use of instant computing resources available in each individual cloud. Therefore, the combination of cloud computing and blockchain can achieve high scalability of the integrated system.”
  • Security of the blockchain: Implementing blockchain hashing algorithms on cloud computing could potentially improve the entirety of the blockchain system’s security. Cloud can utilize its available security tools to maintain blockchain transactions. Similarly, transaction data maintenance can be secure in cloud databases.
  • Fault tolerance: Cloud is capable of replicating blockchain data across a network of computing servers. All of which robustly interconnect courtesy of collaborative clouds. This will effectively cut down on the single-failure risks thanks to the disruption of any cloud node. Thus, there is a guarantee of continuous services. Moreover, the inter-cloud ecosystem will allow the blockchain system to operate regularly. Specifically, in case a certain cloud server is under attack.

Conclusion

According to the essay:

“...the decentralization of CoT lays the ground for blockchain as data security and privacy solutions, and blockchain can leverage the cloud resources in CoT for intensive mining computations and reliable data storage.”

Put simply, scalability vs elasticity, as well as CoT’s integration, will be at the forefront of creating new disruptions for blockchain technology. Some positive, perhaps some negative, but they will leave their mark nonetheless.