Hybrid Protocols

Definition ∞ Hybrid protocols combine elements from both centralized and decentralized systems to leverage the strengths of each. They might use a decentralized blockchain for transaction settlement while employing centralized components for speed, privacy, or regulatory compliance. This approach seeks to optimize performance and usability for specific applications.
Context ∞ News often discusses hybrid protocols as a pragmatic solution for enterprises seeking to adopt blockchain technology while addressing scalability, privacy, and regulatory concerns. Debates center on the trade-offs between decentralization and efficiency inherent in these designs. The development of hybrid protocols reflects an industry effort to bridge the gap between traditional finance and decentralized systems.