# Survey of Blockchain-Based Applications for IoT
## 13 Challenges  
Despite these advantages, the integration of blockchains with the IoT presents challenges, particularly in terms of scalability and performance. The scalability limitations of blockchain networks can hinder their effectiveness in low-power IoT sensor networks that often require real-time data processing [90]. Additionally, the energy consumption associated with blockchain operations can be a significant barrier to its widespread adoption in resource-constrained IoT environments [91]. Addressing these challenges is essential for the successful deployment of blockchain technology in IoT applications.  
One significant challenge lies in consensus algorithms, which have high communication overhead, particularly in systems that utilize PBFT. While PBFT is effective in smaller networks, its scalability diminishes as the number of nodes increases, leading to performance bottlenecks due to the time required for node communication and consensus [92]. These limitations can hinder the adoption of blockchain technology in applications with high-frequency transactions, such as microgrid power trading, where the demand for quick and efficient processing of numerous low-value transactions is critical [93].  
Additionally, the traditional Proof of Work (PoW) consensus mechanism is criticized for its extreme energy consumption, rendering it less sustainable and practical [94]. Although alternatives like PoS and DPoS offer more energy-efficient methods, they introduce new scalability challenges and potential centralization issues, impacting the distributed nature of blockchain systems [95].  
Blockchain technology is also vulnerable to cybersecurity attacks aimed at targeting distributed ledgers and their consensus algorithms. [PERSON] et al. (2021) explored the security challenges of blockchain-based IoT networks, highlighting vulnerabilities such as 51% attacks, double-spending, Sybil attacks, and private key security threats, while also proposing countermeasures to enhance blockchain resilience in distributed IoT environments [96].  
Interoperability is another challenge with blockchains, as different blockchain networks operate on varied data structures, scalability models, and consensus mechanisms, despite their shared reliance on a decentralized peer-to-peer (P2P) framework. The lack of interoperability leads to fragmented industrial ecosystems, restricted information exchange, and isolated blockchain networks that hinder seamless collaboration. To enhance blockchain adoption, efforts should focus on enabling cross-chain data integration and standardization. Key initiatives addressing this issue include the Enterprise Ethereum Alliance, ITU-T, ISO, SWIFT, and W3C, which are working towards developing interoperability frameworks to bridge the gaps between disparate blockchain systems [97].  
Blockchain technology faces legal and regulatory challenges. Understanding how blockchain technology functions is crucial for developing effective regulations. Many nations are integrating blockchains into regulatory frameworks that address centralization, data privacy, jurisdictional issues, and smart contract governance. Additionally, legal and technological approaches interact, where cost-effective technical solutions may replace legal mechanisms in governance. Blockchains' role in smart contracts and decentralizeddatabases is reshaping legal and administrative boundaries, promoting new governance models that enhance efficiency, fairness, and legal certainty [98].