5 Reasons You Should NOT Use Blockchain

  1. Redundancy- having every network member (node) record every transaction is costly. If removing intermediaries isn’t necessary, central record keeping could be vastly more efficient.
  2. Scaling- a distributed network where all nodes record all transactions will have its common transaction ledger grow exponentially faster than network members. The burden for maintaining this ledger may be impractically large and result in centralization.
  3. Regulation- blockchains exist orthogonally to the law and can’t be easily overturned. In heavily regulated industries that require interpretation, blockchain could be difficult to effectively apply. It’s difficult to comply with all rules and often can’t be easily tailored to existing regulatory infrastructure.
  4. Irreversibility- in many cases, reversibility is desirable. The DAO hack resulting in a fork of Ethereum demonstrates the downside of irreversibility.
  5. Security- incentives must be properly aligned to ensure members of the network have a common stake in the longevity and integrity of the network.
  1. Ammous, S. (2018). The Bitcoin Standard. Newark: John Wiley & Sons, Incorporated.
  2. IBM Developer. (2019). Blockchain Basics: Introduction to Distributed Ledgers. [online] Available at: https://developer.ibm.com/tutorials/cl-blockchain-basics-intro-bluemix-trs/ [Accessed 24 May 2019].

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Finance @ cLabs, shaping Celo

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Alex Witt

Alex Witt

Finance @ cLabs, shaping Celo

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