At the #Nervos deep dive in Palo Alto. Secure, Decentralized consensus is necessary slow. The solution to scaling is to decrease the demand for consensus by moving normal operations to layer 2.
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Jan claims that "on-chain state" is friendlier to layer 2 solutions, that can participate securely with light clients.
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The layer 1 equivalent of a "contract" will then be a threading of successive states. Operating on such states is left as an exercise to other layers.
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