There are two incentive problems that Proof-of-Work (PoW) and Proof-of-Stake (PoS) blockchains inevitably encounter that undermines network scalability:
1⃣ Tragedy of The Commons Problem
2⃣ Free-rider Problem
2/12
These are types of problem that lead to market failure wherein individuals can profit by behaving in ways that imposes cost on the whole ecosystem.
