Top Disadvantages Of Blockchain Technology


Even while the internationalization of blockchain technology appears promising, it may not be the solution to every business issue we face.

Blockchain adoption has been challenged even if Bitcoin is a common phrase and it is ready to infiltrate every conceivable business. The rise of Cryptocurrencies has been accepted and welcomed due to social media hype.

Bitcoins and other digital assets have enabled the creation of secure exchange platforms like BitAlpha and made Crypto trades a common financing option.

However, the mechanism behind these digital assets is yet to be adopted. Its utility is widespread. However, the complication and implementation issue has barred it from gaining as much popularity as other new technologies.

How Does Blockchain Work?

Blockchain, the foundation of the virtual currency Bitcoin, is a digital record of every transaction that occurs across an entire network.

Every transaction that occurs on the chain is replicated by every member of the network.

Distributed Ledger Technology refers to the decentralized database that is governed by several users (DLT).

Transactions on a blockchain are recorded with an unchangeable cryptographic signature known as a hash.

Limitations Of Blockchain

Every coin has two sides. Similarly, a blockchain, despite all its advantages, comes with a few limitations. Given below are some of the major disadvantages of using blockchain technology—

Immutability Of Data

Immutability refers to a blockchain ledger’s capacity to maintain a permanent, irrevocable, and unchangeable record of transactions. Immutability has the potential to make auditing a rapid, effective, and affordable process.

The data that companies utilize and exchange on a daily basis may also gain more credibility and integrity as a result.

Blockchain’s implementation only cryptographically protects data such that it can never be changed or removed without repercussions; it does not instantly transform data into truth.

The historical immutability that the blockchain hashing process offers may be enhanced by taking steps like immediately sharing your hash results with stakeholders (customers, auditors, etc.).

Implementation Issues

Blockchain technology implementation entails a significant upfront expense. Even though Hyperledger and the majority of blockchain solutions are open sources, they nevertheless demand significant investment.

Businesses that enjoy the concept of blockchain but lack the resources or finances to implement it may have to wait longer.

Only 29% of businesses are actively experimenting with or implementing blockchain technology, according to APQC.

Businesses are progressively collaborating and creating working groups to address shared issues. This reduces dependency on paper records and secure medical trial data and helps to protect the security of the supply chain.

The key is making early financial investments. Costs associated with implementation may be too high for some businesses.

Even if the majority of the existing solutions are free, a sizable investment is necessary. Perhaps delaying the adoption of blockchain technology is preferable if enterprises are unwilling to invest a large sum of money.

Environmental Impact

Blockchain uses cryptographic methods to store, exchange, and synchronize data as “chains of blocks.”

The recorded transactions are represented by blocks, and a chain is formed when each new block is connected to the ones that came before it.

The management of the ledger, including its exclusive storage, updating, and transaction verification, is not carried out by a single central authority.

Blockchains like Ethereum have so far developed a negative reputation for using an inefficient consensus process.

Finding a balance between maintaining safety precautions and “greenness” is difficult because their goal is to boost security.

There are several distinct variants of these consensus algorithms, some of which are superior to others. It’s vital to remember that the technology is still mostly in its first stages.

A proof-of-work consensus method is used by the majority of blockchain-based solutions, including Bitcoin, to validate transactions. This process requires excessive computational power, around equivalent to Denmark’s annual electricity use.

Prices are always going up due to the resources required to cool down the machinery. Therefore, if proof-of-work is your only choice, you will have to pay for it out of your energy budget.


The blockchain contains benefits in addition to downsides. Most of these are distinctive. Businesses must once more weigh the benefits against the disadvantages we briefly addressed earlier (and any additional ones not covered).

The biggest challenge for all blockchain implementations may be to address (if possible) the fundamental conflict between centralized and decentralized systems.