Major Things Missing in the Blockchain Industry

From promising the highest level of security for personal information to taking over financial institutions and decentralizing the control taken over by the government and public industries, the blockchain miracle has been portrayed as a near ‘one-cure-for-all’ for the world problems.
Although blockchain technology has carved a niche for itself in security and finances, not all is as ‘picture-perfect’ as it is claimed. Every technological revolution has difficult periods, and the blockchain is not an exception. The following issues in the industry have been identified:
  • There is a high chance of human error
  • The technology is highly complexed and comes with a lot of technical jargon
  • 51% attack
  • The concept of decentralization is unrealistic
  • Blockchain technology is not environmentally friendly
  • Firm blockchain regulation is non-existent

There is a high chance of human error.

Although blockchain technology is largely automated, there is still a significant amount of human input. The miners that upload data into databases are susceptible to making to human errors. An error on the part of a miner would largely affect the quality of information that goes in and out of the database.

The technology is highly complexed and comes with a lot of technical jargon.

It is usually expected from a highly specialized industry; however, it makes it difficult for the layman to fully grasp what the blockchain is about, which contradicts the claim that the technology was built to help and empower the public. Its complexity slows down the rate of adoption by the masses and ultimately affects the end-user consumption.

51% attack.

Satoshi Nakamoto, unidentified spearhead of the Bitcoin blockchain, gave a warning about 51% attack. This attack is an elemental security issue in blockchain technology. The enormous number of computers function as nodes to service the central network. Therefore, if a notable number of these computers, say about 51%, get corrupted or are fed ‘lies’, they would likely corrupt the whole network. In short, once the majority of the computers input a ‘lie’, the ‘lie’ may become the truth.
For this reason, the human workforce of miners should be monitored closely to ensure that neither individual nor system manipulates the network for personal favors.

The concept of decentralization is unrealistic.

Curtently, the technology does not appear to be entirely decentralized as it is claimed. Miners of the blockchain came to create a community of influencers of the technology. They make decisions that affect the technology, such as the appropriate time for an upgrade or when to ‘fork’ a blockchain – a process that involves updating the blockchain’s protocol.
Since the miners usually make these decisions despite the input from public, one wonders if their community is not a form of centralised authority over the blockchain.

The technology is not environmentally friendly

Mining the blockchain today is energy-intensive ‘labor’, as it consumes a huge amount of energy. The technology requires a large amount of computing power to provide encrypted security and to establish a connection in its large, distributed network. Last year, it was claimed that the leading blockchain technology – Bitcoin – used up as much energy just to keep its network running as over 150 of the world's nations.
Unfortunately, using faster and energy-conserving computers can't solve the problem, as these computers can cause security issues by making the technology vulnerable to fraudulent activities or hacking. Nonetheless, the hazardous consequences due to this high energy consumption on the environment should not be overlooked.

Firm blockchain regulation is non-existent.

Leaving the blockchain technology ‘lawless’ comes with risks. Due to lack of regulation, market manipulation and scams are quite common. Cases of Ponzi schemes to rob investors of loads of money have surfaced (e.g., the Oncecoin Ponzi scheme).
Even those that invest in relatively established coins like Bitcoin are not safe due to the highly volatile nature of the value of cryptocurrencies and the high chance of having their wallets (where investors store their coins) hacked. This led to imply more strict rules that emphasise the need for regulatory blockchain interventions, especially in the areas of privacy, security, liability, and user data protection.
Despite of these issues, there are brighter days for the blockchain industry. The lack of an in-depth understanding of the technology shouldn't stop non-techies from working creatively with the experts. Whether via discussions or open dialogue, they should be involved in decision-making processes on how the technology is utilized.
This is a basic way to ensure the blockchain technology evolves to cater to society's needs and provides real value to humanity. Only then the full potential of blockchain technology ca be reached.

Comments