IT Insights- Why Blockchain Adoption Is a Slow-Go

IT blockchain

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A number of projects

A number of projects were established to advance the usage of blockchain. In 2014 the Ethereum project was created as an open-source, public, blockchain distributed computing platform and was the first one to gain traction.

Since then there were a number of "hard forks" of the code that are not backwards compatible.

In 2016 the DAO fork, a platform for the autonomous governance of investment capital, was found to contain an unexpected code path that let any sophisticated user withdraw an arbitrary amount of funds from the DAO. This was a major problem and resulted in the community splitting up into two different software solutions – Ethereum and Ethereum Classic.

While this move was designed to get a common consensus and eliminate further deviances, there have been additional forks of both software platforms.

However, regardless of which fork one uses, the transactional performance with methods that use miners to verify the transactions is slow, with some transactions taking minutes to complete. (Bitcoin currently handles a maximum of seven transactions/second.)

These solutions also lack privacy, have poor governance processes, operate on permissionless networks, and lack legal contracts amongst participants. In fact, it is part of the design of the public blockchain architecture to reveal information so that anyone can trace the transactions.

This is great from an auditability standpoint but it means anyone can verify that a transaction actually occurred. Moreover, if an individual or company mistakenly purchases a large quantity of cybercurrency or securities, the immutability of a blockchain would make it challenging to fix the error, as blocks cannot be removed from the chain.

Instead, new transactions need to be created to offset the error.

(end of part 1). In Part 2 we will discuss the two new project offerings, the potential for savings and the top 25 use cases. 

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About the author

Cal Braunstein

Mr. Braunstein serves as Chairman/CEO and Executive Director of Research at the Robert Frances Group (RFG). In addition to his corporate role, he helps his clients wrestle with a range of business, management, regulatory, and technology issues. 
He has deep and broad experience in business strategy management, business process management, enterprise systems architecture, financing, mission-critical systems, project and portfolio management, procurement, risk management, sustainability, and vendor management. Cal also chaired a Business Operational Risk Council whose membership consisted of a number of top global financial institutions.

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