Top five hurdles that keep Blockchain from going mainstream
I was amazed to see this..look at the growing search volume of Blockchain technology. With such an aerial search, have you ever fathomed why we hadn’t used a software/system that is built with Blockchain?
What is stopping Blockchain from being adopted by masses? What are the challenges faced by startups and MNCs while releasing the tools supported by Blockchain? What are the technical hurdles that stop Blockchain from mass adoption?
For many such queries, let’s dive deep into the challenges faced by Blockchain technology — trust? Integration? Security or just the anxiety to adapt to new technology is stopping us. Let’s explore –
Energy Consumption
A consumption Index chart powered by digiconomist for Bitcoin and Ethereum depicts the rise of power consumed by each of the networks.
According to de Vries’ estimations, this year bitcoin will use more than 30 TWh (a Watthour is the amount of energy needed to run a 1W appliance for an hour) of electrical energy. For comparison — Ireland, a country with a GDP of $293 billion, roughly the same as bitcoin’s market capitalization of $284 billion, consumes around 26 TWh of electrical energy. Every transaction on the bitcoin network uses up the amount of energy sufficient to power more than eight U.S. households for a day!
The reason for this network to use such a massive power is the consensus algorithm employed by them — Proof-of work, which validates transactions committed on the network. The design mechanism of the algorithm requires miners to solve the complex mathematical problem to verify and determine the transactions, to secure the network. The mathematical problem takes up a lot of power to solve the problem, and also power is needed by computers to keep them running and simultaneous cooling down when required.
While high usage of power is what makes firms reluctant to adopt, it also raises concerns over climate change.
However, the Ethereum network is exploring ways to opt out of Proof of work concept that may make it more environment and adoption-friendly.
Lack of Regulation and Standardization
While adoption with the masses is suspicious, MNCs and startups are trying to build the innovative solution in every possible way. It may lead to births of newer frameworks and protocols that may lack standardization.
On the other hand, as the technology is in a nascent phase, there is no regulation stating — what kind of information be stored, shared or accessed on the network. Could data sovereignty be handled on a blockchain network? Such queries need a legitimate answer so that consumers data is protected and cannot be misused.
Deployment Cost and Integration with Legacy System
While Blockchain technology offers, advantage’s like immutable, decentralized, data ownership the initial implementation cost is high. The enterprises working on new solutions need to purchase software, develop it in-house or acquire the software. The blockchain technology also uses specialized hardware, that may further shoot up the deployment cost.
On the other hand, the modern technology is not backward compatible leading to its integration with the legacy/existing system a hard thing. The legacy system must be wholly eradicated to make a place for the new blockchain technology for it to work seamlessly, quite similar to the adoption of computers when registers in Banks were taken away.
Lack of Talent and Knowledge
While the Internet is flooded with bookish knowledge on Blockchain, very few are aware of its implementation and execution techniques. Industry experts talk about the probable use cases that feel right, but the challenge is its adoption and implementation. The terms of creating a new block, components of the block, consensus algorithm, hash keys, etc. seem lucrative theoretically but get confusing while implementing.
The preliminary question whether they need to adapt to Blockchain technology cannot be answered because of the lack of knowledge and awareness. Hence gathering practical expertise about blockchain technology would help in the long run.
Scalability
Talking about the scalability of the application — Ethereum can handle 800k transactions per day, whereas Bitcoin is nearing 500k. While some of the apps like Crytokitties and Etheremon users were complaining about the high transaction fees and their transaction weren’t being processed, the need for scalable blockchain network is on. Currently, Ethereum can transact 15 transactions per second, but a lack of much higher speed transaction is in need.
However, an upcoming technology sharding is trending and helping in splitting up the network into smaller pieces called shards, that could significantly improve transaction speed. We would need to explore further on scalability issue to help blockchain technology adoption to mass
Article Credits : Samiksha Seth
REFERENCES
https://www.cognizant.com/whitepapers/the-blockchain-imperative-the-next-challenge-for-p-and-c-carriers-codex2360.pdf https://www.inc.com/quora/whats-stopping-blockchain-from-going-mainstream.html https://www.nasdaq.com/article/five-challenges-blockchain-technology-must-overcome-before-mainstream-adoption-cm899472 https://www.entrepreneur.com/article/312489Originally published at www.blockchainindia.co on June 19, 2018.
