Blockchain is a decentralised ledger system that outperforms centralised systems in a number of ways. It consists of peers connected in a dispersed network, each with a copy of the ledger. To validate transactions between such peers, the network uses a consensus approach. Let’s say there are three of you. While each person is capable of functioning autonomously, they require centralised authority to conduct transactions among themselves. When sending money to another person, for example, one must use a centralised bank or payment channel. Although blockchain technology has the potential to change the world, we must first understand its shortcomings in order to fully appreciate what it has to offer.
Disadvantages of Blockchain Technology
- Not a Distributed Computing System
A blockchain is a network in which nodes are required for effective operation. The quality of the nodes determines the blockchain’s quality. For example, Bitcoin features a robust blockchain that encourages nodes to join the network. A blockchain network that does not reward nodes is not the same as a network that does. This means it’s not a distributed computing system where the network isn’t depending on the activity and cooperation of the nodes. A distributed computing system, on the other hand, guarantees that transactions are reviewed against rules, recorded, and have a transactional history.
- Problematic in Scalability
The scalability of blockchains is lower than that of their centralised equivalents. If you’ve ever used the Bitcoin network, you’re aware that transactions are prioritised based on network traffic. This problem is linked to worries about the scalability of the blockchain network. Simply put, the more users or nodes that join the network, the more likely the network will slow down! However, the way blockchain technology works has changed dramatically. As the technology advances, scalability solutions are being implemented in the Bitcoin network. The solution is to perform transactions outside of blockchain and rely on the blockchain purely for data storage and retrieval.
- Lack of Efficient to some point
Several blockchain technologies are now accessible. Choosing the most popular, such as Bitcoin’s blockchain technology, shows a variety of inefficiencies within the system, since this is one of blockchain’s key downsides. To begin with, when I tried to install the bitcoin miner on my PC, I quickly noticed that the ledger might easily approach 100 GBs. Because nodes must duplicate the data whenever it is changed, there must be a better way to manage this. Furthermore, as more transactions and nodes are added to the blockchain, its size expands. It will slow down the entire network if it continues to expand. This isn’t ideal for commercial blockchains, which require a network that’s both quick and secure.
Despite the limitations outlined above, customers benefit from blockchain technology in terms of assuring the safe traffic of their websites. So, you’d want to create a blockchain? Feel free to reach out to AIO Metaverse to know more about certified blockchain expert Malaysia .