Let’s understand the meaning of blockchain in an uncomplicated manner first. It is the division of data at the same time on several computers. Blockchain technology is a redistributed ledger keeping track of all the transactions. It gathers information on a global network providing security to organizations with their data. This new technology offers several benefits, however, startups and organizations are facing certain challenges related to it.
Here is the list of challenges faced by firms while adopting this technology:
1. Pronouncement:
A method on the ways of the transaction is not declared yet in the blockchain technology, although the firms have started using services or products based on blockchain transactions. Though it assures transparency in all processes, no guarantee is assured for data. To overcome this particular problem, organizations and governments are required to instill some rules for blockchain.
2. Security & Privacy:
Organizations and businesses will quickly unite as all the information is compiled in the global networks. It thus creates tension among the government and the firms to limit access to their data amongst individuals. The technology, therefore, is not suitable to work with sensitive data.
The other alternative to leverage this technology and overcome the previously mentioned challenge is to customize the blockchain. Customization will allow access to information associated with the individual’s tasks only. The process tends to take a little longer but helps them to adopt the blockchain technology positively.
3. Energy Utilization:
Proof-of-work is a validation process that leverages computing power and resource usage. It needs the computation of convoluted mathematical problems, to substantiate transactions, process them, and establish a safe network. For implementing these processes, blockchain technology needs a computer system with enough energy to sustain the power and solve the problems that follow. Apart from this, it also requires supplementary energy to cool down the computers.
4. Primary Costs:
In the long run, blockchain technology benefits the company in reducing costs. However, during the initial stage of its establishment, it requires huge investment. For adopting blockchain technology, the firm needs to develop software that functions wholly as per the activities of the firm which is ideally quite expensive. It also requires specific hardware to work as per the core tasks of the company.
5. Lack of Necessary Skills:
Apart from the technical aspect of blockchain technology, organizations also need to hire the right resources to function smoothly. With the rapid growth of blockchain technology, they need to be uncompromising to hire the personnel that suits best for the tasks. Not many companies have the skills to maintain such technology, and not many are aware of its functionality as it is new and being adopted gradually. Hence, whenever the firm hires an employee, they need to analyze their blockchain knowledge.
Blockchain technology will evolve gradually. Organizations facing any of the above-mentioned challenges must outsource their blockchain projects to one of the top blockchain technology companies. This will help them reap the benefits of this new technology.
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