Who Uses Blockchain Technology and Why?
Making secure networks is one of the main uses of blockchain technology. Blockchain technology makes data storage across a network of users very hard to attack. In order to change the data as long as the network is operating normally, hackers would require access to every node. The transparency of blockchain is yet another key advantage. There is no way to hide anything because everyone has access to the same data. Blockchain simply makes it impossible for a business to maintain secrecy.
Applications For Blockchain Technology
Although blockchain is most famous for being used in cryptocurrencies, it also offers a wide range of other possible applications. Smart contracting is one illustration. Without a third party to supervise the contract, two parties can engage into a legally binding agreement using smart contracts. Identity verification is another illustration. Imagine being able to establish your identity without having to divulge any private information. You may register to vote, open a bank account, purchase real estate, obtain a loan, and more.
Supply chain management, voting systems, online gaming, medical records, and crowdfunding are some further applications for blockchain that are possible.
Risks And Difficulties Of Blockchain
As was already mentioned, blockchain is a strong instrument with a wide range of applications. It does, however, carry some dangers and difficulties. The question of scalability comes first. At the moment, blockchain technology is only effective with modest data volumes. The time it takes to execute transactions grows longer as the volume does. This causes bottlenecks and slows down the entire network.
Second, blockchain is still an emerging technology. Numerous businesses are developing solutions to these issues. However, it might be years before we see widespread usage because blockchain technology is still in its early stages.
Algorand, DeSo, Solana, Stellar, and Cardano are a few examples of projects aiming to address the scalability problem. As of this now, Ethereum can handle 20 TPS while Bitcoin can only process 7 TPS. This issue is currently being addressed by Ethereum. After the Shanghai update and sharding, scalability ought to significantly increase.
Although the Bitcoin Lightning network can execute 1,000,000 transactions per second, there are still certain inherent hazards. One of the primary issues with the Bitcoin Lightning network is that it is vulnerable because it must always be up. You can place your money in cold storage via the lightning network, which is seen to be the safest method for protecting your cryptocurrency.
Conclusion
Blockchain technology is a ground-breaking concept with the potential to revolutionize our society. Whether you concur with this assertion or not, it cannot be disputed that blockchain technology is here to stay. It will significantly reduce our problems with fraud, market manipulation, identity theft, and other problems. Although blockchain still has a ways to go, it will soon be a part of our daily life.
