Blockchain has the potential to revolutionize the finance industry forever. With wide application in various industries, it’s one of the disruptive technologies of the century. It has several use cases in gaming, supply chain, healthcare, data security, and other industries.
Many tech experts predict that the future of blockchain technology is bright. However, there are some challenges with Blockchain technology. In this article, we will try to overview why it can cause a problem with its adoption.
Problems in Blockchain Adoption
Despite several benefits, there are some major problems in Blockchain adoption. Here you will know about those factors and what are the feasible solutions for these problems.
Blockchain is a Complex Concept for Many People
It is a complex concept for many people. It takes a while to understand the principles of distributed ledger technology and cryptography. It requires some research, reading to understand the concept.
Although there is a hype that Blockchain can provide better services without an intermediary, banks are doing it very well at a low cost. Again, many people don’t trust the technology as it is a new concept, and there is no physical existence of digital currencies. So, they cannot rely on a system that does not have any real presence.
Blockchain is a peer-to-peer distributed ledger technology that relies on cryptographic encryption to provide high security. For this, complex algorithms are essential that require high computing power. When it comes to high processing computation, it’s a costly process and requires high processing devices like a GPU or ASIC.
Most people cannot afford an ASIC because they are costly. The high-power consumption can also have a negative impact on the environment. So, it’s one of the crucial factors that may cause a problem for the adoption of Blockchain Technology. For more information you can visit here cpomagazine.com
Lack of Regulation
Another major problem of most of the Blockchain networks is the lack of regulation. As a result, market manipulation and cyber scams are common problems with Blockchain technology. Due to the high demand for cryptocurrencies, many people are investing in them for the first time.
However, most of them are not aware of the security risks that a crypto Blockchain network can have. So, it’s one of the major causes for which it becomes a problem for Blockchain adoption. Even if you are looking at the market with speculation, it’s safe to stick with a popular cryptocurrency like Bitcoin or Ether.
Blockchain Can Be Slow and Intimidating
Another big reason is Blockchain can be slow at times. Due to the complexity and distributed nature, sometimes it may take a long time for transactions. It can be intimidating while paying for something at a retail shop. The traditional financial system is trustworthy and allows faster payment options with debit cards and digital wallets today.
You may find several news and articles claiming that Blockchain can enable faster transactions; they are true only for small transactions. It requires a significant development for the wide adoption of Blockchain technology.
Rejection from Central Banks and Governments
Despite the huge popularity of cryptocurrencies, several central banks and governments don’t support Blockchain technology’s adoption. Banks are making huge profits being the middleman for financial transactions. However, they will lose their customers if cryptocurrencies become the mainstream.
Therefore, there is a strong rejection of cryptocurrencies and Blockchain technology from some central banks and governments. However, a few leading banks of the world are trying to release their cryptocurrencies. But they are not going to impact every part of the world.
The Final Thoughts
The above factors can cause some problems for the adoption of Blockchain technology. As mentioned above, it has several fundamental problems that hold it back from mass adoption. Despite the huge interest in this technology, proper infrastructure and regulations are essential for the wide adoption.
Most of the crypto investors and tech-enthusiasts are very optimistic about the technology; however, the future is uncertain. Hopefully, the article has helped you to understand the potential problems of blockchain technology. Please share your views on this post and what you think about its adoption in the comment section.