Over the last decade, numerous blockchain platforms such as Ethereum, Ripple, Hyperledger, R3 Corda, IBM Blockchain, and Bigchain have become important for developing their own diverse use cases despite the challenges they pose. It has increased. What will the future of blockchain look like when Facebook’s scale emerges on the horizon and countries like India and China consider their own flat cryptocurrencies?
In an interview with Celsius CEO and VOIP inventor Nasdaq, Alex Mashinsky estimates that blockchain systems will be 1000 times larger than today’s Internet. He explains the analogy by comparing the 90’s telephone with the transition to the Internet, which is just an application on voice networks.
“When I was working with Voicemail, the internet became so big that I could feel that Voice was just an application on the internet.”
“Blockchain and cryptocurrencies are the future of everything. This means that network is gonna be 1000x bigger and more powerful than the internet because it requires much more processing power. Also, the largest network always wins.”
Challenges And Limitations For Blockchain
While Mashinsky is talking about the future, blockchain use cases have recently been limited in availability and adoption, despite the numerous protocols and consortia that support them. Mainly due to lack of awareness, lack of infrastructure, dexterity to existing complexity, and many other factors.
So what are the major factors that limit blockchain potential?
- Complexity Of Blockchain
- The 51% Attack
- High Energy Consumption
- Lack Of Skilled Tech Workers
Complexity Of Blockchain
The beauty of blockchain lies in the complexity of the network. The more parties that connect to a transaction, the more applicable the blockchain will be. Initially, many PoCs were completely impractical in terms of functionality and cost efficiency, as there were very few nodes running the blockchain. In addition, most businesses and banks are now partially adopting blockchain. Rather than being completely centralized or decentralized, companies are taking a hybrid approach. This greatly increases complexity. Even if your existing applications are small, more companies will need to hire dedicated blockchain experts.
Second, blockchain applications cannot be easily duplicated between operations and use cases. All applications need a deeper understanding of business needs, and applications such as insurance contracts and land registration can have significantly different blockchains.
The 51% Attack
Remember that Ethereum Classic attacked 51% in January of this year? On January 5, Coinbase discovered a deep chain reorganization of the Ethereum Classic blockchain and immediately suspended its interaction with the ETC blockchain.
The Decentralized Autonomous Organization (DAO), which controlled Ethereum, was also attacked in 2016. This resulted in a loss of $ 50 million. H. More than one-third of the funds. As a result, the Ethereum community has decided to hard fork or disconnect the blockchain in order to create a new blockchain. The new hard fork cryptocurrency became Ethereum (ETH) with reverse blockchain theft, and the original cryptocurrency continued as Ethereum Classic. So what is a 51% attack on ? Satoshi Nakamoto, the inventor of Bitcoin, defined himself to be honest about the largest CPU mining networks. For public blockchain, 51% of attacks are malicious miners or groups of malicious miners who control more than 50% of the network’s mining power or hash rate. A miner (or perhaps a group of miners) that controls more than 50% of the hash of the network can block the history created by the rest of the network and even define a new canonical transaction history.
But today, attention logs are written by miners and developers to avoid such attacks.
High Energy Consumption
Bitcoin is one of the most popular uses of blockchain, and even its first use. Bitcoin Core requires approximately 200GB of storage space on each node that is part of the blockchain network. In particular, it requires 5GB uploads and 500MB downloads daily. India is still struggling to implement Bharatmala broadband projects and 4G with limited availability and capacity in all states, but blockchain implementation certainly requires major infrastructure upgrades.
For the Bitcoin blockchain, energy consumption remains one of the biggest problems facing miners. Researchers at the University of Cambridge estimate that Bitcoin uses more energy than it does throughout Switzerland. Energy is primarily supplied to keep the entire network alive. This is just a blockchain. Imagine if you have more networks like this. But in modern times, preventive protocols have been written by miners and developers to avoid such attacks.
Scalability is another possible issue and hurdle for many blockchain applications. For example, compare the largest centralized payment systems. H. Visa, and the largest crypto payment system, i. H. Bitcoin. If Visa can handle 65,000 transactions per second, the maximum Bitcoin speed is 7 transactions per second. In a centralized architecture, the control agency determines the flow and does not unnecessarily inform other peers about the transaction. It saves time and speed.
Verification takes minutes because the blockchain architecture requires a large number of nodes to approve the transaction. Bitcoin works with the Proof of Work model. This is safe, but at the same time slow. The Proof of Stake format has alternatives that allow entry validation faster, but are not considered an ideal option for distributed consensus protocols.
Brain-Drain for Blockchain
According to various surveys and reports, more than 80% of Indian blockchain developers are moving abroad in search of better opportunities. Developers cite a brain drain that can be traced back to the lack of a “strong regulatory framework” for blockchain technology. The report suggests that blockchain developers are moving to Singapore, United Arab Emirates, Estonia and Switzerland. These offer startups tax breaks and residence. The significantly improved digital infrastructure in these countries is also suitable for blockchain applications.
The Government of India recently announced that it is actually working on the upcoming national blockchain framework. But such promises have been made in the past. The government had previously asked NITI Aayog to develop a roadmap for the largest blockchain-based governance project called India Chain. However, two years have passed since the announcement, and there are few updates in this regard. This only further discouraged blockchain developers.
Keep in mind that memory, high energy consumption, scalability, and many other issues are current issues. As blockchain continues to evolve, many of the existing problems have already been solved or are being processed by various protocols. Therefore, despite these existing flows, it is the advantage of blockchain that the score far exceeds the limit.
Also, many of the problems can be solved based on the implementation. Currently, private blockchains and approved blockchains are either top-level integrated or hybrids of different blockchain protocols are used to achieve what is needed. This also removes many of the above restrictions.