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HomeTechnologyWhat is Blockchain Technology? How Secure is it?

What is Blockchain Technology? How Secure is it?

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What is Blockchain Technology? Distributed ledger technology, known as blockchain, keeps an ever-expanding list of records, or blocks, that are encrypted and linked in an immutable way. Blockchain data is intrinsically resistant to tampering since each block includes a cryptographic hash of the prior block, a timestamp, and transaction data.

“Blockchain” is an abbreviation for “block” plus “chain,” meaning a sequence of “blocks” or a chain. There is connectivity between these blocks or groups of data. Traditional models of information flow assume data originates from one source and is routed through one server. Blockchain operates on the principle of consensus.

Node Based Network:

Network “nodes” meticulously validate every digital transaction data. Blocks of datasets join the chain after a majority consensus. Every node on the network has a copy of the information shared, much like a distributed logbook or ledger. This makes blockchain different from banks, title companies, and third-party intermediaries.

In comparison to other database management systems, blockchain shines here. Blockchain technology has been a game-changer since the internet because it removes the need for trusted third parties to mediate digital transactions.

Security on the Blockchain:

One of blockchain technology’s most distinctive aspects is its security. For what reasons does it serve as a deterrent? Take a look. Before adding blocks, blockchains must undergo lengthy consensus procedures. Block contents are hard to modify. Because each network block hash is related to the previous block hash. Hashes are strings and numbers combined in an alphanumeric format.

If an attacker gains access to the block and changes the transaction data, the hash of the block will also change. Since the following block would still include the hash from the initially “doctored” block, the hacker would have to update the information there, so this is not an option. If you did that, the hash of this block would also change. Continuing this method forever would force the hacker to change every chain block. Recalculating the hashes requires vast, unknown processing power. AdAddingk to a blockchain makes its subsequent editing and deletion extremely challenging, if not impossible.

Proof-of-Work:

Blockchain networks have instituted testing for machines that wish to become part of the network and contribute blocks to tackle the trust issue. Members must first “prove” themselves to join a blockchain network through the tests. One popular method of Bitcoin’s verification is known as “Proof-of-work.” To earn the right to contribute blocks to the blockchain, computers participating in the Proof-of-Work (PoW) system must demonstrate competence. And the way? Mining is the process of solving complicated mathematical problems. However, mining is not as simple as it may appear. According to statistics, there was a 1 in 5.8 trillion chance of solving a PoW challenge on the Bitcoin network in February 2019. Computers must run programs that consume much power and energy (read: money) to answer complicated mathematical problems under certain conditions.

Even if proof of work doesn’t eliminate hacker attacks, it does render them primarily ineffective. The odds of a hacker successfully coordinating an assault on the blockchain are 1 in 5.8 trillion, much like any other person solving a problematic computational arithmetic problem. Almost surely, the advantages would not justify the costs of planning such an assault. Despite being around for nearly a decade, blockchain is still in its early stages as a technology. However, there is more buzz about it than ever before. Everyone from national governments to multi-billion dollar corporations wants to ‘blockchain’ their operations. The far-reaching ramifications of blockchain technology are reminiscent of the technological revolution that swept the globe following the internet’s inception.

Key Features of Blockchain:

Blockchain technology’s main selling points are its essential characteristics:

  • Decentralization: Unlike traditional ledgers, blockchain does not have a central authority, reducing the risk of corruption.
  • Transparency: Changes to the blockchain are viewable by all participants and cannot be altered without consensus, ensuring transparent operations.
  • Security: Cryptographic techniques make blockchain extremely secure against fraud and hacks.

Blockchain in cybersecurity:

All kinds of data, including financial transactions, measurements, personal details, and trade secrets, can be safely stored on blockchain ledgers. Obviously, we wouldn’t use the same blockchain for all of these data sources. Using a public blockchain that specializes in financial data, a mobile app may handle payments in a manner similar to a traditional credit card. By utilizing a smart contract blockchain similar to Ethereum, an Internet of Things (IoT) device can gather data locally, compress it into a smaller package, and then send it to a data centre for further analysis. The device can then act on the results.

Blockchain in data security:

In the future, a blockchain network may be able to handle sensitive personal information like SSNs, driver’s licenses, and credit report details. Whether a private solution for personal data belongs under government oversight and the level of public or private participation in this network are questions that voters and authorities will have to decide.

Even though the data is safely nested in the regular layers of security standards, the level of comfort we have in making medical records accessible in a digital network with global reach is an open question and belongs in the same conversation as healthcare security.

This is an incomplete list of the many data security and cybersecurity applications of blockchain technology. There will be more as creative types and business owners direct their energies toward the blockchain industry. The capabilities of these immutable data ledgers have only barely been scratched.

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