What are the disadvantages of blockchain technology?

31 Oct 2022

The disadvantages of blockchain are listed below:

Scalability: One of the most significant disadvantages of blockchain technology is that it cannot be scaled owing to the set size of the block for storing information. Because the block size is 1 MB, it can only carry a few transactions on a single block.

Immaturity: Because blockchain is only a couple of years old, people do not have much confidence in it, and they are not ready to invest in it. However, several applications of blockchain are doing well in various industries, and it still needs to win the trust of even more people in order to be recognized for its full utilization.

Energy Consumption: Because validating any transaction consumes a lot of energy, it becomes an issue. According to the survey, 0.3 percent of the world's electricity was consumed in the verification of transactions done using blockchain technology by 2018.

Time-consuming: In order to add the next block in the chain, miners must compute nonce values numerous times, which is a time-consuming operation that must be sped up before it can be utilized for industrial purposes.

Legal Formalities: Because of environmental concerns, several nations prohibit the use of blockchain technology applications such as cryptocurrencies, and they do not promote the use of blockchain technology in the commercial sector.

Storage: Because blockchain databases are stored on all network nodes, there is a storage issue; as the number of transactions increases, more storage is required.

Regulations: Blockchain is encountering difficulties with several financial institutions. Other components of technology will be necessary in order to fully implement blockchain.