Blockchains have some problems that are still being resolved.

One thing should be clear by now: blockchains are not a fad. It’s already been proven that blockchain has the potential to revolutionize commerce and finance. But there are some issues that need to be worked out.

One of the most important problems is that blockchains can lose data. This isn’t a common or likely problem, but it is something that’s already happened to the Bitcoin blockchain.

This happens when two or more of the large groups in the computer network – the ones responsible for storing the information – are unable to agree on the correct state of the blockchain. When this occurs, the network forks, or splits.

So you could ask two nodes about your Bitcoin account, and if each node is on a different side of the split network, you could get two different account statements. Obviously, this would be a nightmare for every financial institution using the blockchain.

A split can also occur if the connection between the nodes is cut. This would cause the formation of isolated groups within the network. But such a split would be resolved as soon as the connection is reestablished.

The network will always accept the group with the highest computing power as the “true” state of the blockchain. This is because the “longest” chain requires the most power and is considered the most up-to-date. Unfortunately, this would mean that all transactions made on the smaller, rejected chain would be lost.

Another issue with blockchains is that it’s impossible to be completely anonymous or confidential.

Every transaction requires a sender address and a receiver address. These addresses are also called pseudonyms, and are only a long string of letters and numbers – things like “17fHXHDB8.” But the details of every transaction can be seen by everyone. So if someone’s paying close attention, it’s quite possible for the patterns and details of your transactions to reveal your true identity.

This lack of confidentiality, especially as it pertains to extremely sensitive data such as medical information, might prevent blockchain becoming widely popular. But there’s also hope that the issue could soon be resolved.