The challenges are threefold — technical, regulatory and ‘industrial disruption’. On the technical side, there are the well-known hurdles around transaction speeds, forking related issues, scalability (as more and more DAPPS run on the same underlying platform like Ethereum) and of course, mining power.

All of these have several solutions / workaround : for e.g. Mining is not necessary to create blocks; Staking works just as well although has to deal with double-spending etc. in a different way.

Scalability (for platform chains like Ethereum) is being addressed via sharding, a hardware technology that may provide an answer. And transaction speeds are already a non-issue — even for the slowest network out there — the bitcoin network. This is due to the introduction of a layer on top of the chain — something called lightning network, which essentially only requires consensus for the initial onboarding and offboarding of sender and recipient. All transactions thereafter go directly between the two entities, instead of cluttering the underlying chain.

The regulatory challenges have been getting a lot of attention and there is emerging clarity around whether cryptocurrencies (for example) are securities or not. Whether they can be used as collateral, debt, stock or other such purposes? These are being addressed country by country, mostly, rulings are in favor of cryptocurrencies being legitimate and even, useful!

The ‘disruption’ challenges are easy to understand if one realizes that a Bitcoin Network can (and in some cases HAS) replaced a bank altogether.

Storing currency, transferring currency, even taking a loan out on bitcoin as collateral, is all doable with just YOU and YOU along as your banker. Why would a bank be needed for most day to day transactions then?

The same logic applies to any centralized entity — smart contracts have the ability to replace entire legal contracts, arbitration disputes, escrow services and such. Any ‘centralized’ worker is a candidate for replacement by blockchain technology. At the same time, I don’t see much evidence of this ‘replacement’ taking place as yet.

So, in brief, industries may be partly worried about workers being ‘replaced’ — just like AI is threatening to replace a lot of workers.

Several notable companies including Volkswagon, Lufthansa, Citibank, Toyota are all investing heavily into Blockchain Tech (usually Private, Permissioned chains like Corda, Hyperledger…).

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