Problems with Blockchain Technology
Blockchain is an extraordinary technology, But It has both side of coins, We all know the benefits of Blockchain, Lets talk about problems associated with this wonderful tech.
A lot of the code that’s running blockchains, especially for the newer fabrics that exist, is really, really new. It hasn’t been battle tested, it hasn’t run for (too many) years*, and it hasn’t supported millions of users. There’s definitely some room to grow.
*I’m clearly not talking about Bitcoin here, which has been running and stable for quite some time. Two points though; I’m of the opinion it can’t scale indefinitely, and Bitcoin isn’t that useful in solving the majority of enterprise use cases which require high speed and resource efficiency.
The next problem is scale, and while some blockchains have been around for a while now, none of them are popular enough to be exposed to the eventual demands placed on large scale global systems. There’s some significant maturing to do here, and I expect that the brick is going to fall off the track a few times as we tune for performance.
Speed is a tricky one, and generally we’re not sure how fast blockchains need to go. It is safe to say that they probably need to go a lot faster than they do now if they are to be used as broadly and intrinsically as some people are suggesting. Even Bitcoin would fall drastically behind if it tried to support global transaction volumes. But it really depends on how you use blockchains or ledgers, which information or transactions you need represented, and how quickly they need to be settled or verified, and all of this is largely dependent on the use case.
Some people have equated blockchain to the Internet. I’m not entirely sure if this is a reasonable comparison, but if we follow it then we’ve got quite a while before there’s any type of widespread and ubiquitous usage of blockchain. Again it’s also unclear to me whether blockchain is truly a better solution than traditional technologies for some problems. Innovation labs are going to be playing with things for a while.
It’s worth touching on energy impact briefly, and the key point here is that some of the blockchain frameworks are quite resource hungry. Bitcoin may be the worst, with every new block being added to bitcoin requiring more energythan it takes to run a typical US household for an entire day. Not all blockchains are this hungry, but I’m advocating for blockchains which are energy neutral, or at the very least energy efficient.
Key Takeaway: Not mature, limited scale, quite slow, long adoption curve, and often high energy costs to run.
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Hitesh Malviya is the Founder of ItsBlockchain. He is one of the most early adopters of blockchain & cryptocurrency enthusiast in India. After being into space for a few years, he started IBC in 2016 to help other early adopters learn about the technology.
Before IBC, Hitesh has founded 4 companies in the cyber security & IT space.