Leveraging the benefits of blockchain technology for Internet-of-things (IoT) systems has been a challenging research problem due to its limited resources and power budget. Recent research (published at IEEE TVLSI’20) has suggested a blockchain protocol for heterogeneous IoT frameworks that replaces the traditional hash and encryption algorithms with alternative lightweight modules based on physically unclonable functions (PUFs) and configurable non-linear feedback shift registers (CNLFSRs). The suggested protocol denoted as PCBChain achieves power and energy improvements while maintaining mathematical security under specified security assumptions. In this paper, we propose a power side-channel attack to reverse engineer the value of the secret parameters and the challenge-response pairs. Later, we use this information to find the secret being shared among the IoT nodes. We demonstrate that combining power-based side-channel analysis with the operating time of CNLFSR steeply decreases the security of the proposed protocol. This reduces the number of simulations that the adversary has to do from exponential to linear complexity over the length of CNLFSR, thus breaking the construction of PCBChain protocol. In addition to this, we have also suggested an alternative solution to mitigate the aforementioned vulnerabilities in the construction of IoT-friendly blockchain.