The basics of SMP? It's frankly not there yet - it's Creative with limited resources, infinite maps, and a few neat mods (see: Runecraft). Notch's next big job is adding monsters and non-infinite player health, at which point it'll shift from "Nothing to do but build awesum towerz" to "OMG CREEPER RUUUUUN!". Which should answer your question about "challenges"
If we're debating features, then flows still suck (lag makes it near-impossible to manipulate them, spring tiles seem to interact poorly with non-spring flow tiles, etc.), we're missing monsters and player health as mentioned above, and lag is in general a huge problem. Actually, optimization in general is a huge problem, but latency is the most obvious issue at the moment. When I can mine a block and not have it pop back into existence 3 seconds later, then vanish again 3 seconds after that, I'll be content. And I shudder to think what monster combat (or worse, PvP) will be like with the degree of lag we've currently got. After all, melee combat in Minecraft is mostly timing-based - smack your enemy
after he gets into range but
before he hits you - and that kind of combat is, from my experience in
other melee-based FPS games, a crapshoot with normally-tolerable delay, let alone the ridiculous problems of the current netcode.