The infographic from PWC (Price Waterhouse Company) indicates what the respondents of a survey feel are the biggest barriers to blockchain adoption in their respective industries in the nest three to five years.
Similarly, the following infographic from 101Blockchains.com lists the top 10 blockchain adoption challenges. A larger and more legible image of the infographic can be found here
Hitachi has been wanting to play a major role in overcoming the barriers to blockchain adoption. The table below shows the top five challenges that were of greatest concern in Hitachi’s discussions with over 50 blockchain user companies, including financial institutions and government agencies
Summary of Top Challenges
Here is a quick summary of the main challenges facing wide-spread adoption of blockchain in the near future:
- Scalability: Both Bitcoin and Ethereum, the leading blockchain networks, have experienced slowed transaction speeds and higher fees charged per transaction as a result of a substantial increase in users.
- The Criminal Connection: In a paper titled ‘A Survey on the Security of Blockchain Systems’published through the Cornell University Library, a team of researchers found that cryptocurrencies are used by criminals to facilitate purchases of restricted materials on online marketplaces, as a tool for money laundering, as well as payment methods for ransomware.
- Inefficient Technological Design: The Ethereum smart contract platform allows developers to deploy their own decentralized apps (DApps). However, a substantial number of smart contracts deployed on the platform have vulnerabilities due to their coding.
Moreover, the Bitcoin network is designed to include a significant amount of data with each transaction. This makes the Bitcoin blockchain heavy and rather slow.
- Energy Consuming Consensus Mechanisms: It has been reported that the miners who work to validate transactions in the Bitcoin blockchain consume about 0.2 percent of the global electricity totalper year. This is equal to what the country of Bulgaria consumes. Moreover, going on the current trend it is being estimated that by 2020 the Bitcoin network will require more electricity than what the entire world currently uses.
- Costs: because it is a relatively new innovation, it is difficult to integrate Blockchains with legacy systems. Such a process is an expensive affair.
- Shortage: of blockchain engineers, and developers who can make products and make it marketable. (Prof Ahmed Banafa)