During the Ethereum Community Conference in Paris on March 9th, Vitalik Buterin, the Ethereum co-founder presented to the world via a live stream on Youtube, Plasma Cash. It will serve as a more improved version of their blockchain scaling solution, Plasma. The solution will lower transaction fees for decentralized applications and smart contacts by optimizing data that is moved onto the root blockchain.
During the live stream, Buterin went onto explain the big differences between Plasma and Plasma Cash. The original Plasma has some issues when it came to the scalability. Exponential scaling was prevented due to the fact that users had to authenticate and download each plasma block.
When it comes to Plasma Cash, a user would only have to pay any mind to the blocks that contain coins that they want to keep track of. If a user decides to put a certain amount of ether into an exchange or a third party service,a plasma coin would be created with the same value as the ether deposited and it would come with an ID that cannot be merged or split.
He further stated that, “A user actually only needs to verify the availability and correctness of the Plasma chain only […] at the specific index of the coin, of any coins that they own and any coins that they care about.”
That said, Buterin thinks that his technology is the perfect way for cryptocurrency exchanges to make themselves for resistant to hacking. Each plasma is owned by someone and they are not completely interchangeable. This blocks out the risk of someone taking a user’s coins without a user being fully made aware of it. With this technology the owner would have the ability to prevent any frauds placed against him.
Even if a hack takes place a user won’t lose any money if he’s using Plasma Cash. Buterin ended his talk at the Ethereum Community Conference on a positive note. “Regardless of what happens in the exchange, users can run their money through the Plasma exit procedure and get their money out.” He further stated, “Whenever the next big multi-billion dollar exchange written by a totally incompetent developer gets hacked, no one will lose any money.”