The pandemic had already raised questions about global reliance on an economic model that has broken down trade barriers but left countries heavily dependent on one another – Copyright AFP John MACDOUGALL
Blockchain technology has been making waves in various industries. The concept, especially for supply chains, promises greater efficiency, transparency and security. Yet despite its potential, the technology is often misunderstood and plagued by a “blockchain bias.”
This is something that has been detected by the founder of blockchain storage company Züs, Saswata Basu. The technologist wants to address the misconceptions surrounding this innovative technology, as he explains to Digital Diary.
According to Basu, there are six essential reasons behind the “blockchain bias”. These are:
lack of understanding
According to Basu: “Many people are intimidated by blockchain technology because it is a relatively new concept and is often misunderstood. Despite the complex underlying technology, the basics of blockchain are quite simple: it is a linked list of transactions that are an immutable and transparent form of payments and activities on a distributed ledger without relying on third-party services or trusted entities.
security concerns
People may fear that blockchain technology has too many security weaknesses and that malicious actors can easily exploit it. To this, Basu responds: “In reality, however, blockchain technology is one of the most secure options available today, as the data stored on the blockchain is incredibly difficult to manipulate or alter in any way.”
High cost of Blockchain implementation
Basu acknowledges that the cost of equipment and energy involved in running a blockchain system can be quite high. This is: “Due to the need for specialized hardware and software resources required to maintain the network”
However, when the costs are balanced, Basu observes: “Recent blockchains are efficient and can use the same power as your laptop to run a node on the chain.”
scalability issues
Due to its decentralized nature, scaling a blockchain network can be difficult as more participants join the network and require additional resources such as storage space or computing power.
There are solutions, Basu explains: “Innovations like sharding are helping to address this problem and make scaling much easier for all types of projects, from small start-ups to large enterprises.”
Lack of regulatory framework
Although governments around the world have been taking steps to regulate cryptocurrencies and other associated technologies, there is still no clear global framework to govern these systems.
While this may cause some confusion among potential adopters who don’t know what rules to follow when using them, Basu says: “There has been some guidance based on SEC actions in some categories, such as DeFi and staking projects.”
adoption challenges
Despite its many benefits, adoption of blockchain technology has been slow due to a lack of familiarity with its concepts and applications, as well as a general lack of knowledge about how it can benefit businesses or individuals on a practical level.
This will change Basu’s notes: “As more people realize how transformative blockchain technology can be for certain industries, we should expect to see more adoption over time.”
