Blockchain is a timestamped collection of immutable records that are attached in the form of a never-ending linear chain. Its characteristics, such as decentralized network and anonymity, make it the most trustworthy technology by far. But everything has its pros and cons, so does blockchain. Blockchain is one of the best technologies developed, but due to the lack of technical awareness and its relation with Bitcoin makes it doubtful.
In this article, the obstacles faced in efficiently implementing the blockchain technology are discussed in detail.
Immutable means something which cannot be changed or improvised. The records of the blockchain cannot be modified once created and broadcasted on the chain network. It protects the integrity of data making it tamper-proof, but at the same time, it has its drawbacks. No corrections or revision can be done in order to reverse the errors made while entering the data. Once the data is on record, it is imperishable.
- Organization and Size
Every transaction needs to be validated or verified by every block over the network in order to reach a mutual consensus. A blockchain network may be vast in size, depending upon its growth and dispersion. The number of nodes and blocks determines the network size. The bigger the network size, the more time is consumed in the process of reaching consensus in an authentic manner. This leads to considerable consumption of time and resources.
The consensus mechanism requires every participating node to validate the transactions. This restricts the number of transactions that can be carried out over the blockchain network during a given time. As a result, an existing blockchain, Bitcoin can only process seven transactions a second.
- Plethora Proof of Work
Proof of work is an overload. The fact still holds true even if disregarding the energy consumption in terms of electricity and processor time. The dependability on a single linear chain even by Proof of Stake and other solutions is a soft underbelly or flaw. Options are being explored to avoid this discrepancy.
- Excessive Energy Consumption
The energy consumed by miners and giant mining sites in terms of electricity does not diminish with the outcome, which is the creation of a new block. According to statistical reports, Bitcoin’s energy usage is alone equivalent to Switzerland’s annual energy usage.
The most doubtful angle is that even after reducing the number of miners and energy consumption corresponding to it by ten folds, the Bitcoin would remain as efficient and stable as it is now. It would work at the same speed, processing the same number of transactions and produce an equal amount of blocks at the same interval of time.
- Lack of Technical Awareness
The developers these days are mostly trained in technologies like Java, C++, or Python. The lack of technical expertise in blockchain restricts its development and management. Even if it is developed, the users of the blockchain are unaware or incompetent to use its implementation. Thus, awareness about blockchain’s development, implementation, and usage must be spread.
- Regulation and Management
One might assume that if the blockchain is recorded at every node, then a single person or participant cannot shut down a blockchain. The absence of any central authority would make the closing down of any blockchain impossible.
This is probably a misconception. For instance, in Bitcoin, miners tend to operate in competing pools. This is done in order to ensure that they earn a reward for their work in which they have invested through electricity consumption and processor time. The main aim here is to avoid concentration. The indestructibility of a blockchain is proportional to its dispersion. For instance, if more than 63% of miners of blockchain are from the same country, then the jurisdiction of that country can hamper indestructibility by halting communication services or seizing server sites.