In current Blockchain, Crypto currency, and NFT are the hot topics that attract much attention from many young people. These new technologies have contributed a lot to the computer science industry. They are the main core for some new applications and software that provide new services and concepts to the users. They are also the inspiration for all IT companies when they are forming the idea to develop their products. We all know blockchain technology is necessary, and it is a trending for the future development in this industry. However, beside its advantages, it also has some drawbacks that we should know about.
First of all, its advantages:
Open: One of the major advantages of blockchain technology is that it is accessible to all means anyone can become a participant in the contribution to blockchain technology, one does not require any permission from anybody to join the distributed network.
Verifiable: Blockchain technology is used to store information in a decentralized manner so everyone can verify the correctness of the information by using zero-knowledge proof through which one party proves the correctness of data to another party without revealing anything about data.
Permanent: Records or information which is stored using blockchain technology is permanent means one need not worry about losing the data because duplicate copies are stored at each local node as it is a decentralized network that has a number of trustworthy nodes.
Free from Censorship: Blockchain technology is considered free from censorship as it does not have control of any single party, rather it has the concept of trustworthy nodes for validation and consensus protocols that approve transactions by using smart contracts.
Tighter Security: Blockchain uses hashing techniques to store each transaction on a block that is connected to each other so it has tighter security. It uses SHA 256 hashing technique for storing transactions.
Immutability: Data cannot be tampered with in blockchain technology due to its decentralized structure so any change will be reflected in all the nodes so one cannot do fraud here, hence it can be claimed that transactions are tamper-proof.
Transparency: It makes histories of transactions transparent everywhere all the nodes in the network have a copy of the transaction in the network. If any changes occur in the transaction it is visible to the other nodes.
Efficiency: Blockchain removes any third-party intervention between transactions and removes the mistake making the system efficient and faster. Settlement is made easier and smooth.
Cost Reduction: As blockchain needs no third man it reduces the cost for the businesses and gives trust to the other partner.
Now, let’s go to the other aspect of this technology: Even Blockchain technology’s disadvantages just play a very small role in the whole story we also need to take a look at it:
Scalability: It is one of the biggest drawbacks of blockchain technology as it cannot be scaled due to the fixed size of the block for storing information. The block size is 1 MB due to which it can hold only a couple of transactions on a single block.
Immaturity: Even though several applications of blockchain are doing great in different industries it still needs to win the confidence of even more people to be recognized for its complete utilization.
Time-Consuming: To add the next block in the chain miners need to compute nonce values many times so this is a time-consuming process and needs to be sped up to be used for industrial purposes.
Legal Formalities: In some countries, the use of blockchain technology applications is banned like cryptocurrency due to some environmental issues they are not promoting to use blockchain technology in the commercial sector.
Regulations: Blockchain faces challenges with some financial institutions. Other aspects of technology will be required in order to adopt blockchain in a wider aspect.