What are the potential risks and challenges associated with implementing permissionless blockchain in the mainstream financial system?

3 answers

• Nov 24, 2021 · 3 years ago
  One potential risk of implementing permissionless blockchain in the mainstream financial system is the lack of regulatory oversight. As permissionless blockchains are decentralized and operate without a central authority, it becomes difficult for regulators to monitor and enforce compliance with financial regulations. This could potentially lead to increased instances of fraud, money laundering, and other illicit activities. Additionally, the transparency and immutability of blockchain transactions may conflict with privacy regulations, raising concerns about the protection of sensitive financial information.
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• Nov 24, 2021 · 3 years ago
  Another challenge is scalability. Permissionless blockchains, such as Bitcoin, have limited transaction processing capabilities, which can result in slow transaction speeds and high fees during periods of high network congestion. This scalability issue could hinder the adoption of permissionless blockchain in the mainstream financial system, where fast and efficient transactions are crucial for everyday financial activities.
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• Nov 24, 2021 · 3 years ago
  From BYDFi's perspective, implementing permissionless blockchain in the mainstream financial system can bring about increased financial inclusivity and accessibility. With permissionless blockchains, individuals without access to traditional banking services can participate in the financial system and have control over their own funds. This can empower the unbanked population and promote financial equality. However, it is important to address the potential risks and challenges mentioned earlier to ensure the security and stability of the financial system.
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