Blockchain, Pros vs Cons

Pros of Blockchain

As with any new technology, you will discover there are pros and cons for blockchain-tech. Blockchain gives numerous advantages, yet it has disadvantages also. Understanding both is crucial for making the right decision when evaluating a certain cryptocurrency investment. Blockchain is no different from other new technology, the advantages it offers come at a cost. There are some cons to the blockchain that must be well considered in order to conclude if blockchain is a wise choice.

Pros of blockchain technology are:

• No involvement of a 3rd party (central authority)
In a decentralized network, there no central server to authenticate and authorize transactions between peers/users.

• Double Spend Problem
Blockchain is the first technology capable to solve the Double Spend Problem without having to trust on 3rd parties, such as governments.

• Transparent & Verifiable
Accountability to clients and (end)-users, even without permission

• Protected
Control who sees which data and when with a permissioned network

• Quality Control
Track the backgrounds of all supply chain components. Smart Contracts replacing the middle men.

• Reducing Transaction Costs
Removing middle men reduces cost (example: payment-providers, banks & other financial institutions)

• Tokenization
Produce exchangeable tokens supported by real value
Partly Asset Ownership and Asset Digitization (example: own 1 house for 100%, or own 2 houses for 50%)

• Extremely Fault Tolerant
If a single node loses connectivity to the network it would remain working by other nodes in the network, which will take over his work. Compare it with a group message, if you want to delete a message in the group you will need to delete it on all phones as an everyone carries a copy. Fault tolerance is particularly useful when there are many people participating.

Cons of the blockchain technology are:

• Extremely slow compared with traditional databases (inefficient)

• New technology, continuously changing and evolving

• Scalability

• Transaction- time and costs

• No centralized ownership or single authority

• Extremely difficult to get a ‘’helicopter view’’ (overview) of all the solution and its possibilities

• Most platforms and projects are still in development mode, and may not be ready for big applications yet.

About Coinmerce

Coinmerce is a Dutch, fiat ⇄ cryptocurrency trading platform that focuses entirely on usability and simplicity to offer its users a safe, educational, simple and enjoyable experience.

The Coinmerce platform is connected to various external exchanges and bundles liquidity through its smart order system in order to automatically offer the best prices to its users.