Limitations of Blockchain technology – Security Boulevard


The elephant in the room is the viability and sustainability of blockchain technology. Cryptocurrency mining, for example, requires specialized plants that consume electricity. In some estimates, at the time of writing, the energy consumption of the bitcoin network reached 41 globally if it was a country. This means that the bitcoin blockchain consumes more energy than in Switzerland and the Czech Republic.

Most of the energy consumption is linked to the mining sector. The security and the guarantee of integrity come from cryptographic primitives that are combined with the restriction on the structure of the block (number of initial zeroes for the generated hash). This is articulated as proof of the work. The difficulty associated with work evidence increases over time based on the network's consensus framework. This only affects the public blockchain, as private blockchains can work with insufficient proof of job requirements.

There are potentially three paths forward. The first is to maintain the difficulty level for the block generation constant. Unfortunately, this may not solve the problem of energy consumption. Why? Generating the block to be added to the blockchain is not a linear search problem; it's more like a lottery. You could get it in a first generation of hashes or it might not get it even after millions of hash generations.

The second floating option is increasing the computational power. It is correct that the increase in computational power of graphics processing units (GPUs) has grown faster than Moore's law. Furthermore, it is possible to formulate a discussion, and has a certain weight in its rationality, that improved GPUs will consume less energy than their previous versions. This is true, and could in the future be used as a potential path to reduce the energy needs of the blockchain network. However, it is still an open question and we do not have (Read more …)

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