There is a voracious appetite for technology related to blockchain technology. Looking back at SXSW 2018, it would be difficult to miss the forty sessions focused on the topic – a programming note which was so loud that it was mocked on the social media by technologists and journalists.
It is obvious that technologists, consumers, executives, and so many others want to know more about blockchain technology. Technologies with such potentials do not come around much often. A lot is written and said about the potential of blockchain to disrupt, but the scale challenges inherent in the design of blockchain are usually overlooked.
Until these challenges are resolved, blockchain technology will only have an impact on narrow applications and networks that are tightly constrained.
Blockchain is a distributed ledger technology (DLT). Accounting sub-ledgers record transactions between a company and its clients, employees, suppliers, and other partners. The clear benefits are reduced audit costs and instant reconciliation. The less obvious benefits are from the smart contracts of the blockchain, and this can boost accounting activities in terms of transactions.
These capabilities could be built into products, but most customers are not yet ready to adopt blockchains. Blockchain networks cannot scale to support higher volumes. Blockchains are too inefficient. Besides the scaling issue, standards are not developed enough to induce participation.
What Is the Solution?
Monumental is the potential of using blockchain, so is the value in solving its scaling issues. This is why some tech firms find ways to provide blockchain solutions to their clients while bearing the complications with computational scale themselves.
In the forthcoming years, you will see software vendors in several industries chip away at scale challenges by beginning with their own limited customer base. Managing blockchains will become a fundamental task for software providers, down to installing software on containers and servers that make the technology function.
Princess Ogono is a writer, lawyer and fitness enthusiast. She believes cryptocurrencies are the future. When she's not writing, she spends time with her adorable cat, Ginger and works out often.