What are the disadvantages of blockchain technology?

03 Oct 2022

Every coin has two sides, and so does Bitcoin. You may have heard about how it can reshape the global economy, but do you know about the downsides of blockchain that make its future rather dim?

• Scalability: The more adoption of blockchain systems, the harder it is to scale them for the masses. As the market expands, new full nodes for validating transactions and blocks get daunting to set up. The practicality of blockchain, therefore, is quite painful to imagine with the issue of scalability in view.

• Storage: The blockchain ledger size increased from 150 GB to 250 GB between 2019 and 2021. The size of the database will only grow as the number of transactions increases, and personal computers cannot store infinite data that is simply appended.

• Privacy: Anyone in the network can access data on a public blockchain, and without governmental control, there is a high risk of illegal activities happening on the chain. For example, criminals often use Bitcoin to buy drugs on the dark web or to hide the source of illicitly acquired money.

• Regulations: Regulatory regimes for financial services pose a challenge to the implementation of blockchain. In the event of fraud, blockchain applications will have to lay down a procedure for identifying the perpetrator, which is a bit of a challenge.

• Security: No matter how tamperproof a blockchain protocol is, an attacker gaining control of one node's communications can fool the rest of the network into confirming bogus transactions. According to Emin Gün Sire, selfish miners can obtain a revenue larger than their share by tricking other nodes into cracking solved crypto puzzles.

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• Crypto payment gateway
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