[MUSIC] In this video, we'll look at the first showstopper of implementing blockchain. The technology is not ready for prime time. Some people still have a vague understanding of cryptocurrency. Even fewer have heard of blockchain technology. Though that has changed significantly since Blockchain Revolution was published in 2016. Still, you are among the forward-thinking few. And to change the stigma and help spread awareness and understanding, we need to work together. It is a complex task convincing newcomers and tech visionaries that these problems are worth solving. First, we must identify the issues. And there are eight key concerns and we'll cover each here in detail. Our leading concern is that the technology of the future is already here but its infrastructure is unevenly distributed. Consider Greece's 2015 economic crisis. Greek citizens wouldn't have known how to locate a Bitcoin exchange or ATM. Or how to transfer their drachmas into Bitcoin to escape the troubled currency. Strong infrastructure matters. It can't be limited during crises. Unfortunately for Greece, its blockchain infrastructure was lacking at the time of this crisis. This brings us to our second concern, the system lacks the transactional capacity for mass usage. Some of you may remember what happened when AOL dumps 2.3 million email accounts on to the internet. The internet wasn't ready in terms of spam protection and net etiquette to absorb new users. The blockchain would also be prone to capacity problems, systems failures, unexpected bugs and the frustration of non tech savvy users. Some platforms like Ripple and Hyperledger have gone a long way in solving these problems. And up-and-comers like Cosmos may change the game. But this is a still a concern for some applications. Inaccessibility to the average person is our third concern. There's not enough wallet support and a lot of interfaces aren't yet user-friendly. They're in complex code and tech jargon. Costing crypto assets is becoming easier thanks to hardware solutions like the Ledger Nano and Trezor Hardware Wallets. But it's still not intuitive for some. Google is popular and easy to use because people can type in a basic name or word to get results instantly. Bitcoin addresses may ultimately need to have a similar simplicity of use. The fourth concern is liquidity, or rather, the long term lack thereof. Bitcoin has a fixed quantity. For example, there will be 21 million Bitcoins in circulation by the year 2140. But it will be mined at a decreasing rate. As the number of users grows, the value per coin is likely to grow. Perhaps it will continue to grow long into the future. Well, what's wrong with that? You might ask. Here's the challenge. Early adopters hold on to bit coin as miners hold onto gold. They hoard it, hoping the value will increase, rather than treating it as something to exchange. There is also the dilemma of coins stores in lost wallets or sent to addresses whose owners have lost their private keys. These coins can't be recovered. And that means there will be fewer Bitcoins in actual circulation than the 21 million that we mentioned before. The fifth concern is high latency. It takes on average 10 minutes to clear and settle transactions on the Bitcoin blockchain network. It's faster end-to-end than most other payment forms, but it's still too long for certain use cases like the Internet of Things. Where devices need to interact non-stop. Ten minutes is just too long to retail financial transactions were timing matters to get an asset at a particular price. Entrepreneurs can modify the source code by tweaking a few parameters or by launching a new blockchain known as an alt-coin in place of Bitcoin. Litecoin is a popular alt-coin with a block time of two and a half minutes. The sixth concern is the behavioral change required well beyond net etiquette. Bitcoin provides better privacy, stronger security and more freedom from third party cost structures and systems failures. But with greater freedom, comes greater responsibility. Unlike Bitcoin users, average people aren't used to backing up their money on an hardware wallet. In so-called cold storage, disconnected from the internet. They don't think about keeping these backups in separate locations, so if they were to, say, lose everything in a fire, they don't lose all their money. Owning Bitcoin without securing it is a lot like storing money in a mattress, not a smart idea. So far we've covered six concerns why Blockchain isn't ready for prime time and we've got two more to go. The seventh point is societal change. Think about it for a moment. Money is a social construct, representing what a society values. It's a vital part of our social structure because it's molded by our relationships, and it adapts to our evolving needs. So is it really socially unhealthy to create an immutable record of every human transaction in perpetuity? Remember, the blockchain never forgets, it appends, but it never erases. This leads us to the final concern, the possible lack of legal choices in a world of transaction finality and unstoppable smart contracts. Smart contracts can insure a transaction goes through with mathematical certainty, but it allows no room for human doubt or regret. This unprecedented approach means that blockchain users can decide which rules to follow. But once they decide, once they execute a smart contract there`s no backing out. If there is a disagreement among parties will people actually take the counterparty to court? Probably not. After all, most contract breaches in the analogue world are just too costly to pursue in court. Why should those numbers improve in a blockchain world, especially if parties are anonymous? How can a contract executed and fulfilled according to its code be seen as a legitimate breach of contract just because one party is unhappy with the outcome? Will the courts even recognize the case? These are questions stakeholders are addressing today and much progress has been made, but there is still more to do. Perhaps it will be you addressing and overcoming these implementation challenges.
