Pros and Cons of Blockchain Technology

In recent years you must have heard a lot about Blockchain getting mentioned along with bitcoin and every other cryptocurrency. Many have wondered and asked what exactly Blockchain is and why has it become such an eye catcher. Well to put it simply, Blockchain is like a database which stores records of value and transactions. The real difference lies in the way it stores the data. Bitcoin was the first to implement blockchain technology. The success it has shown since then has moved the utility of blockchain in wide range of directions. But like every coin there will always be some pros and cons to anything. Let us check some of the pros and cons of this burgeoning technology.

Pros:

Decentralized– The core value of a blockchain is that it shares information directly with everyone without having a central system. It can run entirely on a decentralised network of computers which reduces the risk of hacking, server downtime, data loss, no middle man and most importantly one doesn’t have to give control of their information to a single institution.

Transparency– Since the data is equally distributed among every user it is not possible for anyone to make changes in the data without being noticed. The transactions once made cannot be altered and deleted. This acts as a security for the users as their information is safe from theft or any kind of hacking.

Process integrity– Each transaction is recorded and time stamped which cannot be deleted or altered by anyone. This provides as a very high range of security. The transactions or blocks which are added to the chain are free from any manipulation of data.

Faster processing– Before the invention of blockchain, the traditional banks use to take a lot of time in completing a transaction but with the use of blockchain the speed has increased to a high extent. The two-way messaging capabilities of the blockchain enable it to cut out the middle men of intermediary and custodian banks that slow transactions down.

Cons:

Lack of oversight– With such big scale market which is left open sourced or decentralised, makes people uncomfortable to use. Since it doesn’t have a central authority, people are uncomfortable at trusting it and using it for their transactions especially for the beginners.

Cuts out the middle man– As it has been mentioned above how blockchain technology cuts out the middleman. Well the counterargument to this point has been that a lot of middlemen have lost their job as it become redundant.

Regulation is uncertain– As modern currencies are created and regulated by the government, it’s hard for blockchain and bitcoin to be accepted widely since it is not even regulated by the government. This makes it hard for blockchain to get a settled regulation status.

Power use– The consumption of power in the Blockchain is comparatively high as in a particular year the power consumption of Bitcoin miners was alone more than the per capita power consumption of 159 individual countries. Keeping a real-time ledger is one of the reasons for this consumption.

Every disadvantage has its advantage, it is too early to come to a conclusion mere on few cons. The leaders and experienced traders believe that it has a great scope in the future. So let us sit tight and see what turns it makes in the coming years.