What are the potential challenges of using a recursive SQL query to resolve a tree structure in a database?

One potential challenge of using a recursive SQL query to resolve a tree structure in a database is the risk of running into performance issues with large datasets due to the recursive nature of the query. To address this, one solution is to limit the depth of recursion by setting a maximum level to traverse in the query.

// Recursive SQL query with depth limitation
$query = "WITH RECURSIVE tree AS (
            SELECT id, parent_id, name, 1 as level
            FROM nodes
            WHERE parent_id IS NULL
            UNION ALL
            SELECT n.id, n.parent_id, n.name, t.level + 1
            FROM nodes n
            JOIN tree t ON n.parent_id = t.id
            WHERE t.level < 3  -- Limit the depth to 3 levels
          )
          SELECT * FROM tree;";