Ever wondered why blockchain is getting massive attention and popularity these days? The secret lies in how it works. It records and distributes digital information without allowing it to get edited. Moreover, it is rapidly making its mark by boosting efficiency and reducing costs.
Blockchain accomplishes this by omitting the middle man i.e. banks. Most recently, it has come to the limelight due to the popularity of cryptocurrencies. Blockchain is utilized to provide unprecedented security in all forms of digital transactions.
The unparalleled security it offers is because of its intricate maths and innovative software protocols that make it almost impossible for attackers to breach it. But before we dig deeper and discuss how secure blockchain is, I will discuss a little bit the technology itself.
Let’s jump in!
What is Blockchain Technology?
This technology can be explained as a distributed, online ledger that records a digital transaction. What makes it really unique is that it cannot be edited or modified. This is the primary impetus that is expanding its applications in industries like healthcare and cybersecurity.
This technology makes the history of digital assets unchangeable; hence decentralization is the core concept. To understand it better, let’s study an example.
Have you ever used Google Docs? If so, you can understand how Google Docs offers a shared document i.e with several individuals. Everyone can make changes in that document, and all the other members can view those changes. This is an example of decentralized distribution.
Blockchain has achieved recognition in such a short time because it offers transparency for numerous uses. But is it really secure? Does it provide the security and privacy that is required?
Let’s discuss these pointers!
Is Blockchain Immutable?
As we discussed earlier, blockchain records digital transactions in a distributed ledger. Whenever a transaction takes place, all the members with the distributed ledger are automatically updated.
But is the transaction immutable? No, nothing is ever immutable! There is always a possibility of editing or modification. But for blockchain, it is incredibly challenging since the ledger is distributed, and there are complex mathematical puzzles that require great calculating power to be solved.
Accurately speaking, it would take 51 percent of computers to change all the recorded transactions in a short time frame. This is almost impossible to achieve.
When it Comes to Privacy and Security…
There are hardly any Information systems out there that concurrently provide privacy and security. But blockchain does a great job in addressing both these areas. Blockchain ensures this by utilizing the “Public Key infrastructure.” This tool is used to thwart malicious attacks and provide robust security to confidential data.
Wondering how PKI works? PKI works with the principle of two separate keys—one public and one private. PKI works in a way that someone who has the private key can only decrypt the message sent by another key (public key).
To strengthen security, blockchain security solutions maintain the ledger in such a way that it is widely distributed and more extensive. The larger and more distributed ledger means more protection.
But Here Are the Concerns for Blockchain Security Solutions…
There is widespread concern about the blockchain security solutions.. The critics base their argument that even though blockchain security solutions have privacy-protection systems like encryption, blockchain transactions are still visible in network nodes.
The privacy issue related to blockchain security solutions is getting even more critical in light of the recent global emphasis on privacy, especially from the EU. There is a rising global effort to urge companies and businesses to prioritize the data privacy of people.
This is where blockchain is walking a thin line. It cannot control who hosts the node and cannot even delete the data. The immutable principle of blockchain security solutions is an issue here.
Decentralization at Odds with Scalability
There is a dilemma that haunts some companies; achieving scalability with decentralization! If you look at the process, the ledger stores all the transactions and keeps the record. But the problem is since the transactions keep on piling, the scalability is compromised in the process.
Very few companies can store such a mammoth number of transactions. This is where it is challenging to manage scalability and decentralization together.
Blockchain Security Solutions—The Weak Links in the Chain
Employing blockchain for security is not a perfect system. That is why hackers try their best to take advantage of the loopholes present in the technology. For instance, online criminals trick the miners to solve the already-solved riddle. This technique is known as “Selfish Miner.”
Another technique that hackers utilize is disrupting the communication structure of the nodes; this technique is known as an “eclipse attack.” With each year passing, hackers are trying to come up with new ways to breach the blockchain security solutions.
Massive Potential of Blockchain
With all these challenges, blockchain security solutions are still more secure than the centralized system. Remember, if the data is encrypted and keys are kept safe, then there isn’t a problem. Blockchain has the enormous potential to fight cybercrime as online criminals’ can’t modify the data.
Numerous companies and banks have started using blockchain technologies now due to impressive blockchain security solutions. If you are looking to adopt blockchain for your business, you can reach the experts at vteams.
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