Blockchains are appealing to investors because they are a novel technique with the potential to significantly reduce transaction costs. Blockchains enable secure, direct transactions between an unspecified number of users, especially while purchasing NFTs, who may or may not trust one another.
With all of the progress that has been made since the inception of custom blockchain solutions, it is easy to forget that the technology is still in its infancy. Although ten years may appear to be an eternity in the blockchain industry, such rapid growth is typical of early-stage projects. As a result, blockchain technology has a long way to go before reaching its full potential. Furthermore, the technology must gain widespread acceptance, especially in business settings.
The blockchain phenomenon has passed, but other issues with technology implementation are becoming apparent. In this article, we will look at the obstacles to custom blockchain solutions implementation in 2023.
2023 Blockchain Implementation Challenges
Increasing the cost of implementation
It all boils down to how much money is spent upfront. The costs of putting this into action may be prohibitively expensive for some businesses. Despite the fact that most current solutions are free, employing proficient computer programmers who are specialists in blockchain creation, licensing fees in the event of making the transition to a reimbursable software version, general management, and more all require significant expenditure. It is a significant barrier to putting blockchain technology into practice.
The challenge of Unsuccessful Adoption
Blockchains will not be practical or scalable unless a large number of people use them. Blockchains are most valuable and efficient when a large group of people collaborates on them. For a blockchain ecosystem to function, both consumers and providers must sign up for the network.
Problems with Security and Privacy
Many potential blockchain applications necessitate novel transactions and contracts that are inextricably linked to actual people, raising serious data and privacy security threats amidst the confidentiality supplied by digital currencies. Blockchain technology, either on a private or consortium-run network, could be used here. Access would be limited to what is required to guarantee that your individual information stays private.
HR Capability Limitations
Blockchain in business necessitates the use of individuals who can conceptualize, apply, and implement the technology. This includes everyone from the CEO to the product manager or certified blockchain developer. People who are fluent in both technology and business are hard to come by in India. There is a severe shortage of certified Blockchain developers or engineers capable of setting up, implementing, and launching a Blockchain as well as writing smart contracts.
Criminal Action Factor
Because blockchain technology is still in its infancy, and because there are no regulations in place to govern it, fraudulent enterprises and other unscrupulous actors who prey on the gullible have proliferated. Cases of bitcoin theft have gained widespread attention in recent years, nearly bringing down the entire cryptocurrency sector.
Increased Consumption of Energy
The implementation of Blockchain technology necessitates a significant amount of effort. This not only restricts the ability of ordinary people to join PoW networks, but it also encourages the formation of massive mining pools, which diminishes decentralization by trying to force members to participate large mining pools.
It is essential to adopt a measured approach since the failure rate is high. Follow the below-mentioned steps to implement blockchain successfully.
Start with a use case
It is critical to understand why you require blockchain technology to implement it effectively.
Create a Proof of Concept
If you decide to proceed, create a proof of concept first. The procedure will assist you in determining the viability of this technology for your company.
Select the apt Blockchain
There is no single blockchain platform that can serve all industries. That is why it is critical to identify the one that is best suited to your needs. Popular platforms include Open Chain, Hyperledger Fabric, Ethereum, Quorum, Corda, and Stellar are few of the popular platforms.
Build the ecosystem
When the number of stakeholders grows, create an ecosystem to improve system understanding and foster trust. It is possible to achieve this by agreeing on-
The terms of the agreement
Without bias, costs and benefits are shared.
Mechanism of governance
Operate and manage
When you're ready to go, construct the first block with all of the features. Following that, you should establish a secondary affiliation to simplify internal communication. The first step is to send information; the second is to lay the groundwork for others to receive it.
Deployment
The blockchain must now be activated on the blockchain network. You must begin with a cloud server for hybrid solutions that combine on-chain and off-chain entities.
To sum it up
Steady progression and expansion have made blockchain a sought-after technology, but they have also rendered it untrustworthy in terms of long-term viability. Its implementation may necessitate several changes before you begin to see the results that you had hoped for.
As a result, before you decide to implement blockchain in your business, weigh all of its benefits and drawbacks because there is a lot at stake for you. You should also be well-versed in blockchain technologies to make the best use of them.
If you feel unsure, reach out to the experts of your blockchain consulting company to get a better know-how of the entire process, and build a POC first to understand its viability. We at MoogleLabs have dedicated blockchain teams that have enabled multiple businesses with successful blockchain implementation to drive business outcomes. Check our blockchain offerings.