A ‘blockchain’ is a list of blocks which grows continuously based on the amount of information that is added. All the blocks are linked to each other and secured through cryptography. Blockchain technology, which was first introduced in 1991 has gained immense popularity recently since it is the crux of the cryptoasset market.
A rising demand for cryptoassets among investors has opened up an all new dimension for researchers to explore and make advances in this technology. But to eliminate any problems and working towards betterment, we need to know the factors that may fuel the rise of blockchain tech.
Blockchain being a relatively new technology is viewed with skepticism by many people. Many others aren’t educated/smart enough to take advantage. A nation like India — where people mainly rely on physical money — may not feel a dying need to adopt blockchain-based applications. On the other hand, a nation where people are deft enough to complete their transactions mainly through electronic media will find blockchain quite useful. There is a need to inject blockchain in developing nations as it will help not only in speedy and smooth transactions but will definitely result in increasing the GDP of the country, helping in socioeconomic development.
A blockchain without internet is nothing. Here comes a trade-off. We wish to promote electronic transactions but physical money holds equal significance in case of internet failure. Different network speeds in varied locations is a key factor that affects blockchain. A remote place with slow internet may find it difficult to adopt this tech. Internet Service Providers (ISPs) have the power to control the transmission rate of packets from one layer to another. We can say that the number and speed of packets transmitted and received can be varied thereby making blockchain perform poorly. Here comes another issue, that is of net-neutrality, which if it ends, will promote discrimination towards different blockchain applications.
Security and Privacy
Blockchain brings within itself the concept of privacy. It is able to provide privacy to its users effectively because of the highly encrypted network it provides. But this gives birth to another issue. Privacy does help in anonymous transmission of information but in case of any discrepancy or criminal activity, there is nothing that can be done. No one knows from where the information is coming and where it is going. If someone steals my Bitcoins, cyber police is completely helpless because of the huge amount of encryption and decentralisation. On the other hand, although anonymous, all information is shared in a public ledger. Everything that is recorded by the blocks can be viewed by anyone and everyone.
Cooperation among participants
For effective functioning of blockchain technology, it is required that the markets, the exchanges as well as the people using blockchain applications cooperate with one another. Blockchain helps in eliminating the requirement of intermediaries for any task. A bank plays no role if a person wishes to buy or sell their Bitcoins. There’s no such thing as a cryptoasset broker! This transfers greater amount of power into the hands of market forces and exchanges. More power to the people basically means that there’s a need for high-level cooperation among the participants. A country like India could well do with this!
Economic inequality has become a major issue. In a recent survey by Oxfam (International NGO which aims to alleviate poverty), it was stated the top 1% individuals in the world own 82% of total wealth. Now if blockchain technology is given the top priority, it will obviously benefit the educated ones who have 24X7 internet access and own efficient electronic devices. These people aren’t poor, and can take full advantage of this tech. This yet again creates a difference between the haves and the have nots, thereby creating difficulties in their path to acquire wealth.
The need of the hour is to recognize these factors and take huge steps towards revamping the blockchain technology. To know more about blockchain or trading in different cryptoassets, you can follow Unocoin.