I recently want to start a social network project using blockchain based on Steem. Not only because blockchain is a fancy word, but it actually can solve the problem of fair rewarding distribution. When I had the kick start meeting with my management team in the company, they give me a lot of comments like 'Wow! We are going to use smart contract! Because it's so transparent and un-bias, our system will recommend the most efficient ads to the users on our platform!'
Hello? Is this really smart contract can do? It sounds more like an AI algorithm's work. I suddenly feel there are so many misunderstandings about blockchain and smart contract. So I just want to write some of my shallow opinions about what blockchain cannot do (at least at the moment) or not very good at. I am not an expert in blockchain, except I did follow a lot of cryptocurrency news since 2012. So please feel free to comment on my mistakes.
Firstly, blockchain is a distributed database, so anything that doesn't need distribution is not really in the scope. Like the blockchain in bitcoin and ETH, millions of users on the earth contribute their computer as a 'node'. That's where the distributed leger coming from. Compared with them, Steem currently only has dozens of nodes live (https://status.steemnodes.com/). So unless you prepare to really distribute your data to whoever setup the node, don't use blockchain. This is totally different from the multi-region database replication from cloud services like AWS. Most web applications still keep client-server architecture and it solves problems. It's really not necessary sometimes to use Distributed App (Dapp) architecture. It overkills.
A second problem is the user experience, especially the registration or system setup process. Many of them may have a try of CryptoKitties. Well, it's great fun, but most of the people will experience terrible setup process before you can actually buy your first kitty. You need to have a ETH wallet, then bind it to MetaMask, then set it up in your Google Chrome browser. What the hell is that? Do I suppose to just register with my email and password? That's not the end unfortunately. Because of the block size problem of Ethereum, the transaction sometimes could be very very very slow and you have to pay a lot of Gas for that. I am not criticising CryptoKitties, it's an amazing game, but if you want to build a social network totally based on Ethereum? The UX will be terrible.
Third problem, where can you get the kick-start money? There are so many ICOs around, but 99% of them are scam, obviously. I just want to build an app, ok? I don't need to raise $100M and thousands of ETH. But if I don't do that and I build a social network with thousands of users, I actually need to buy a lot of ETH to pay the Gas thinking about thousands of messaging transactions they will make everyday. Why I am doing that? It overkills again.
This is only what I have experienced so far. With my project going on, I will post more thoughts on what blockchain is not good at. Please stay tuned :)