Anyways, scalability is still an issue. However with Pegging currencies it might be possible that people can issue their own currencies for each community and peg it to other larger ones. Thus, their blockchain is secured by their community and buying and selling those can be purely based on their resale value.

Im guessing Bitcoin needs to be rewritten entirely and Etherium is making the bloat problem worse. Of course, both those currencies are heading for a centralized future whereas we are looking at a decentralized one. Pegging and lightning networks are a huge step for that. Combined with smart contracts its almost an entirely complete, self surviving economy. It should be noted, the smaller the economy the more likely the trust is broken and the higher the probability for conspiracy to large aggressive groups to take funds from people. The bigger the economy, the more likely the blockchains rules are kept honest however the hard it is to fork and the harder it is to prevent centralization. Technology might get better and help us have bigger hard drives and more bandwidth so there is still hope. There is a sweet spot somewhere here. So we still need to make sure any economy is large and has a good method of P2P fraud prevention and verification.

Etherium contracts should definitely be stored off the chain. And preapproved by miners as safe. So they are just really making the problem worse unless their end goal is centralized servers.