Blockchain Technology is the new innovative technology that is fueling the success of cryptocurrencies such as Bitcoin and Ethereum.
It is not technology or law holding back the blockchain. Regardless of this technology being the “new internet” as the majority of financial experts like to delineate it, its adoption among several users around the globe has been slow.
The problem is that not so many people understand why.
The slang used to describe the space is very much technical and is strongly settled in the financial space. In a similar way, abbreviations like CDOs confuse everyday clients planning to manage their money, words like “mining” in the crypto and blockchain spaces are similarly confusing.
This, on its own, is a huge obstruction for both cryptocurrency and the underlying blockchain technology—whereas its value cannot be easily explained. And the individuals who came up with plenty of words we use to explain what’s going on in these industries are not necessarily marketers, however, cryptographers who might not be the best speakers for introducing innovations to the majority.
Below are ten big obstructions to mass adoption of Blockchain Technology:
The vast majority think that it's hard to understand the concept of cryptocurrency and how does it work.
Asking them to understand the use of blockchain technology and implement it in their lives is like adding salt to injury.
Basically, the innovative technology intends for eliminating the obstructions experienced with normal or fiat currencies such as strict central authority law and the inessential formalities required when receiving money or making payments.
The blockchain enables cryptocurrency users and investors to transact receipts and payments while digitally positioning the record automatically.
As a lot of people don’t understand how this works, they are doubtful about its use, making consumer acceptance of blockchain difficult.
Even if the change is as good as rest, accepting and embracing it is not very easy every time.
In every circle of life, whether we agree or not, the thought of change annoys most people.
This is because we are usually okay in our comfort zones and changing situations throws us into the zone of fear of the obscure.
The acceptance of new technology is no exemption. People are used to the idea of normal currency and fiat money, and the concept of digital currency is foreign and appears unrealistic.
The blockchain technology and its advantages are yet to trickle down to businesspeople; with users yet to buy into its doubtful regulating circumstances.
Probably, a successively settled system will help users with accepting the innovative blockchain technology and the positive evolution of its effects, such as transparency in transactions.
This draws us to the next barrier on what’s holding blockchain back from massive adoption.
The crypto space has the drawback of non-regularization, at least at the current time; and this is a problem with unbelievers who believe that digital currency is a bubble waiting to burst.
This has diminished the blockchain adoption rate as users often name a lack of rules and guidelines, which make the digital currencies risky to carry out transactions.
Individuals fear to lose their investments and they are less motivated to venture into pursuits with lacking administrative structures.
Another obstruction hampering blockchain technology expansion is the absence of proper guidance on the revolutionary technology.
There has been a lot of illiteracy and inaccurate information with the vast majority thinking the technology is limited to cryptocurrencies and the financial sector.
Business people are unaware of the fact that the blockchain technology goes against multiple sectors — from medical, agribusiness, construction, and travel, and many other industries.
Accordingly, there is a requirement for proper education to enable users to adopt the utilization of this innovative technology in their everyday lives.
To further understand the foundation of blockchain technology, one might start exploring how do bitcoins work as a starting point which is the most popular cryptography & blockchain experiment to the date.
The elevated cost of replacing systems and establishing the blockchain is a considerable obstruction to its massive adoption.
Modification of the blockchain should be done based on the type of business it will be applied to, which can prompt high setup costs, particularly for smaller businesses.
In addition, training employees about technology require blockchain specialists whose expertise comes at a significant cost.
Because they are not too many and their expertise is limited, the demand for their services exceeds their supply, which makes hiring them expensive.Recognizing this, Softlabs, as a seasoned blockchain development company , strategizes to build products that are not only advanced but also cost-effective, fostering mass adoption without compromising on quality.
Operating blockchain systems consumes a considerable amount of energy, which makes them unattractive for environmentally conscious users.
Therefore, to grow the decentralization of the cryptosystems, innovative ways that can empower the technology to keep running on sustainable power source are required.
In case a solution isn't found soon, it will hamper mass adoption as people will comply with for other energy-saving systems.
Validating transactions on a blockchain network generally takes some time — from a couple of moments to hours.
The blockchain technology tends to fall short of expectations since the users have to wait for their transactions to be completed. Because in the modern world, fast speed is highly prioritized.
The blockchain technology is nearly about a decade old. Thus, the blockchain adoption stats is still low because the majority of people see it to be new and immature.
It is presumed that the technology is yet to develop before it becomes grounded and completely acceptable among the majority of people.
At the same time, regardless of slow adoption, the technology is already inducing ripples in various industries.
Blockchain fans believe that it is already unsettling various sectors; the way Netflix is transforming the movie industry and Uber transport industry.
Given time, this technology will get ahead.
Governance in business is focused on the establishment of principles and their persistent monitoring to make sure they are properly implemented and there is correct accountability. Mike Gault, founder, and CEO of the blockchain technology platform Guard time believes that the biggest obstacle is bureaucracy:
"… Administratively, banks are not hooked up to ride this kind of innovation. Quite simply: bureaucracy. Lawyers, compliance, front office, back office, middle office — adopting significant change, or even getting the budget to grow a technology program, could require to close down from all of them. This is required in the risky financial world, but undeniably an obstruction to innovation. If blockchain programs ever leave the incubators, they’ll have to legitimize themselves everywhere throughout the line."
Taking into account what number of the top global banks have been hit with scandals or backfire from the 2008 financial crisis in the form of huge fines, it might be understandable if there were an aversion towards anything that might upset the current situation. Many of the crucial systems that support the world’s financial infrastructure are 15 or 20 years old or more. Replacing them or even renovating them is a heavy task that very few banks may have the appetite to accept.
Unfortunately, there is no agreement on when blockchain is going to be set up for prime time. The WEF thinks blockchain can possibly, “significantly change” the way in which banks lead their business around the world, partially by reducing operating costs and making financial services progressively secure and accessible. Despite that, based on Gartner‘s Technology Hype Cycle, blockchain is at the tip of its increased expectations, but they assess another 5 to 10 years are required before it attains established adoption levels.
The previous seven years have been a wild ride as Bitcoin has moved from purchasing a couple of pizzas to potentially changing the world’s financial infrastructure. We don’t know what we don’t know about what blockchain technology companies are working upon. It’s possible that some will come up with the ideas we never expected that could help blockchain make generational jumps ahead with regards to innovation and launch a driver for adoption across large areas of the industry.
The blockchain is a brilliant innovation that offers a promise of decentralization, security, and transparency for different sectors.
However, the above-mentioned barriers are preventing its mass adoption. If these barriers can be overcome, especially through collaborations with a crypto exchange development company focused on building a user-friendly and secure exchange, it can foster massive transformations and pave the way for wider adoption, ensuring improved quality of service delivery.