People keep talking about Blockchain like it's some kind of magic that can fix everything across different industries, and I kinda agree with that. It’s said to change everything from finance and supply chains to healthcare and even government. I guess it’s because we link Blockchain with things like transparency, security, and decentralization. But honestly, are we just hyping it too much about what it can actually do?
Blockchain has tons of perks, like decentralization, transparency, and immutability. It's super useful when parties don’t trust each other or when you need reliable records that can't be messed with. Plus, it shines in situations where relying on a central authority is risky. In those cases, you gotta admit Blockchain kicks traditional systems’ butts.
But here's the thing sometimes we have unrealistic expectations for Blockchain tech. Not every situation needs decentralization, especially if there’s already a trusted central authority in place. Using Blockchain can complicate simple systems and create unnecessary headaches. If I'm honest, I feel like Blockchain can be slower in certain scenarios. Like in gaming, where online games need quick responses but block confirmations take too long, making it a bad fit for super fast interactions.
You are making a point but it's not spot on. Fact is decentralization is just a type of Blockchain characteristics which simply means all Blockchains are not decentralized infact we have more centralized networks than decentralized networks. A good example is thether on Tron network for example.
Your coins can be frozen there with legal order but for bitcoin it's impossible which shows decentralization and that comes from the consensus and how the network is structured. If there's a central body running it back end with full authority then it's centralized.
Of course it is. Some example of that is "blockchain voting":
Yes. If the fiat system would be better, then Bitcoin simply wouldn't exist. As you can read in the Genesis Block, failures in existing models were literally the input, which pushed Satoshi to start the chain.
Because they are slower. Actually, one of the first criticisms of Bitcoin were related directly to that. In the first implementation, every node had to store everything. And many people thought, that it simply wouldn't scale, and that solving the double-spending problem, by storing each and every transaction, is not a good idea. At that time, people thought that there would be a better way to represent "a coin" in a similar way, as it is done in cash. And then they wondered, how to protect it from inflation, where all digital files can be easily copy-pasted. And now, you can see how: the ability to copy-paste coins is what actually makes Bitcoin stronger, not weaker, because every copy means, that there are simply more nodes.
https://en.bitcoin.it/wiki/Bitcoin_is_not_ruled_by_miners#Efficiency
It depends which games. For example in some card games, you have to download all possible cards from the server, and it feels a bit like Initial Blockchain Download. Because if some player will put "Blue Eyes White Dragon" on the table, your client has to recognize it correctly.
Even if you think about it outside of the blockchain, then still: all you can do, is to require a signature from someone, who will confirm, that it is correct. But is the file actually correct? You never know, all that can be done is checking, if someone signed it.
Good points by the way
But Blockchain are usually pushed by people that want decentralisation
People that don't trust a central authority
Many are just implementing it becomes it sounds innovative.
It cost more in a centralised system where trust is already existing.
It fits more on trustless and decentralization.
But they can make use of permissioned Blockchain in most cases ( even Banks can).
That's precisely the oracle problem, but the real bottleneck isn't the blockchain itself, but rather how to feed it with reliable, real-world data. Until we solve the oracle problem in a practical and decentralized way, many applications will continue to rely on a central source of trust, exactly what blockchain aims to eliminate. From my perspective, blockchain works perfectly for Bitcoin and cryptocurrencies in general. As you yourself mentioned, it does have compatibility issues with many other systems, and that's not necessarily a bad thing. We shouldn't view blockchain technology as a universal solution.
I don't agree fully with this. Both those that want centralization and decentralization can push the block chain agenda but it doesn't mean automatic decentralization. Instead it depends on the network structure and who is eventually holding power here. If there's no shared power with all users it's the opposite (centralization).
The fiat system started to fail and bring bigger inflation effects when banks got greedy and switched from valueables like gold at the time to paper money. Still at some point technology was going to still evolve to the current digital level.
I would argue that the "existing and trusted" situation often stems from the lack of visible alternatives. People are used to a central authority being necessary, so they don't know better. Later, they might be surprised about the problems that can arise from centralization. Take for example Twitter/X where you can see how disruptive centralization can be. As long as a platform is centralized, there is always the possibility of someone buying it and acting contrary to what users trusted in before. Decentralization does indeed add complexity, but on the long run, it might be the more sustainable alternative.
However, blockchain does not guarantee decentralization. Most likely, the major part of today's blockchains are quite centralized, obfuscating the centralization at best. But it is a vehicle that _can_ help achieving decentralization.
If blockchain technology was beneficial on supply chains or healthcare, wouldn't it already have been implemented and used across the world? It's been 17 years since the creation of Bitcoin, and at least 10 years since the development of alternative blockchain networks, but we have yet to see a value proposition of this technology other than Bitcoin.
With the Internet and AI, markets now shift in months. If blockchain was actually useful for anything other than permissionless, globally accessible hard money, it would already have found application there.
Well, there is an example of a non-mined blockchain, which is older than Bitcoin: it is called "git". Each commit refers to the previous one, and even the initial commit points to SHA-1 of all zeroes, just like the Genesis Block does. If you compare for example regtest, and git, then you will notice, that they are similar.
And it happened: people now use it to store data, thinking that each node will keep everything forever. But: if more and more users will use only SPV wallets, then it will be harder and harder to get historical data. The trend is clear: some people now want to rely on UTXO proofs, shared in a P2P way. And even if Bitcoin Core won't implement it, then still: it will happen sooner or later, because this idea is well-known for years, and if running a node will require too much effort, then many people won't stop running them completely, but will simply switch to a weaker security model, which would be faster, than the original implementation.
It is a similar thing, as with transaction puzzles: we should have DLEQ proofs with N-bit elliptic curves, where everyone would be able to trace the real progress of breaking secp256k1. And instead, we just have some centralized puzzles, where everyone trusts the creator of the initial transaction. Why? Because deploying it in a centralized way was easier, and we are now stuck with it.
Well, if it wouldn't scale in a decentralized way, then it would happen through more centralized channels, and the history would simply repeat. For example, now some people start to notice, that if Lightning Network requires solving disagreements on-chain, then it simply inherits many on-chain limits as well. Who knows, maybe after some time people will understand, that as long as we have "layer one and a half", instead of a proper "second layer", then some people will endlessly keep talking about the block size limit, because it will always hit all of these half-baked layers. Things would scale, only if users would be able to create, send, receive, and burn coins, entirely in the second layer, without touching the main chain, like in sidechains. Otherwise, they will always hit some limits, just like C++ language is limited by what C language can do.
To sum up, as you can see, it is always a spectrum of things: centralized fiat systems were weak, so when they collapsed, then Bitcoin was created. But then, Bitcoin required handling everything by everyone, to really make things trustless, and then it turned out, that being your own bank is too hard for many users. Which means, that the history will probably repeat here as well, and most users will pick SPV wallets, centralized exchanges, and treat block explorers as a source of truth, until they will collapse, and this circle will start yet again.
I believe phrase "If it ain't broke, don't fix it" apply here. Many usage or application don't really need decentralization, so traditional database with either website or API to manage and share the data are good enough. I also expect some stuff that claim to use blockchain actually doesn't use blockchain at all or used much less than they claim.
This is a major reason as well, but if blockchain technology reduced costs, or protected reputation, or saved time, or did anything that would increase the revenue of a business, it'd be a matter of time before it was adopted.
No serious business in the healthcare, wealth and relationship industries adopted the blockchain anywhere in the workflow. There's just no translation to increased revenue.
Due to the high costs of decentralization, people tend to ignore decentralized solutions until something bad happens. They will even happily hurt resilience in order to get performance and cost savings. Just look at the Internet itself, which was decentralized from the beginning. Then, its users headed for centralization, put things on Akamai or replaced decentralized and federated e-mail communication by a oligopoly of a few large e-mail providers or even by centralized messengers, thereby creating single points of failure or control.
A logical step might be governments which make more decentralization mandatory in order to achieve better resilience of the infrastructure they govern. This is where blockchains might also come into play. But it's hard to get there because they would have to give up some control they hope to have themselves.
Not every project needs a blockchain and cryptocurrency. And even if it sounds good initially, it doesn't mean that it will work.
A few years ago when altcoins started appearing left and right, I remember reading about a project that was seeking investment to build movie theatres and astronomical observatories to teach children about the stars and solar systems. Doesn't sound bad at first, and why would children not learn? But they you ask yourself: What's that got to do with crypto? Why do we need a new altcoin to build those observatories, purchase tickets and pay staff who would do the teaching? Why does that particular project need a blockchain at all?
The answer is that it's got nothing to do with crypto, it doesn't need a blockchain, and you don't need a new "revolutionary" token to turn an idea like that into reality.