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The Main Challenges Facing Blockchain Technology

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Blockchain technology is an undeniably smart invention.

When entrepreneurs understood the power of blockchain, a lot of them started investing in the blockchain. Its impact has greatly impacted supply chains, healthcare, transportation, online remittances, voting and many more. A huge percentage of financial institutions are using blockchain technology today.

However, blockchain faces multiple challenges. If these difficulties are addressed in time, it wouldn’t take long before the technology is widely adopted.

Inefficient enterprise-level blockchain software developers

Since blockchain technology is a new field, there are barely enough skilled software developers that fully understand it. This is one of the major problems that blockchain employers face. Despite the fact that there is a significant demand for software developers, existing talent is very rare.

The few developers who understand the technology practically write their own tickets. Therefore, this situation limits many companies from re-framing and advancing applications based on the blockchain.

Avoiding Regulation

Regulators aim to establish suitable rules involving the blockchain. Since there seems to be nothing that requires regulation, it is unclear why or rather how regulators should change technological developments.

Part of a regulator’s work regarding the blockchain is to ensure that financial institutions using the technology can’t find loopholes to circumvent existing rules. According to TechCrunch, the advancement of the blockchain should be free of regulations.

During the 90’s legislators opted not to regulate the internet’s potential. The decision led to today’s power of the internet and the open-market creation of the highly praised “information super-highway.”

As the blockchain continues to develop, regulations will no doubt be necessary in some instances. Regulators just need to ensure that the blockchain serves the interests of investors and users, not the contrary.

Building Critical Mass

Education is vital in promoting critical mass. With the blockchain developing daily, adoption should occur rapidly. Once the adoption of blockchain technology is complete, the software will become a unique, universal tool.

Cryptocurrencies and eWallets are the primary users of blockchain technology. For the use of the blockchain to grow and achieve mass adoption, the use of these digital currencies must increase.

 Blockchain Technology Security

While blockchain technology is extraordinarily secure, it has a major vulnerability. This is commonly known as the 51% attack. This refers to a situation where a miner(s) controls more than 50% of the mining power.

In such cases, the miner(s) can control the confirmations of new transactions, including those carried out by other miners. They are also able to reverse the transaction they confirmed and therefore double-spend tokens.

Fortunately, the likelihood of this attack decreases when more miners participate in the network.

 

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