What are my security risk with a blockchain?

Adam Mazzocchetti Blockchain Security

Can we please talk about one of the most important aspects of blockchain technology: the  security of it. 

It is a distributed register for pretty much everything that concerns tracking the flow of good information. I am Not to talk about cryptocurrencies, but to proceed with caution, it is not as secure as it needs to be. 

This is, of course, one of the most important things a company must do for the security of its data and also for its business. 

Enterprise blockchain platforms can be used to track the flow of good information, but that is probably why most companies actually get on the train. 

It is estimated that investment in blockchain platforms and companies will be close to $3 billion by 2021, and 95% of companies in multiple industries plan to invest in blockchains in 2020. 39% of these companies say they earn $5 million or more, 26% say they earn at least $1 million and 5% more than $10 million. 

The government is taking notice, too, and the US Department of Energy (DoE) has provided funds to test the technology to see if it can help protect the country’s power grid. 

The future of enterprise blockchain 

The attractiveness of the blockchain makes sense, given its superior ability to protect data, and is “good overall”. But while cryptocurrencies are demonstrably a risky field, there are companies that do not investigate blockchain in their industry. At the very least, companies should identify areas where blockchain could affect their profits and be open to the potential of new applications. 

Because of its distributed nature, it is difficult or impossible for attackers to corrupt the data of a blockchain system– I want my clients data to be safe. 

Supporters have repeatedly said that an attacker would have to attack every node in the system that processes the data – and there would likely be thousands. In order to understand the strengths and weaknesses of the blockchain, a disruptor must be blind. 

Blockchains still hackable 

Unfortunately, this does not mean that blockchain platforms cannot be hacked, which has long been apparent in the world of cryptocurrencies. Bitcoin, one of the most popular and popular digital currencies, sank last year after an attack seized $400 million. 

While this remains the largest theft, security experts say more hacks are occurring, such as the recent theft of $1.5 billion worth of bitcoin. 

Just last May, hackers stole $40 million from the popular Binance exchange, and much of the technology surrounding it includes software code. This code can be hacked, but that does not mean that basic blockchain technology is insecure. Its cryptography is strict and its foundation is solid, making it more secure than the software itself. 

But whether an organisation’s peripheral infrastructure is secure is another question altogether. I have constantly noted that when blockchains speak of ultra-secure blockchains, they do not mean that the protocol, platform, or algorithm are secure. Much of blockchain technology involves software code, and that code can be hacked. 

Is enterprise blockchain more secure? 

You think that “private” means safe and public, but you’d be wrong, at least for now. Moreover, private blockchains – used and approved by companies – are much more secure than public cryptocurrency exchanges. 

I argue that an enterprise blockchain can offer the same level of security as a cryptocurrency exchange that takes minutes to complete a transaction, while a large enterprise platform processes hundreds of them in seconds, it can be just as secure as the public one. Private networks can make them work much slower than public blockchains in terms of processing time and what they are allowed to do. 

While different companies also have different security budgets, blockchains do not become a digital island for companies. Banks have a lot of money and security, and their partners may have much less or no security than their customers. They are used to connect companies that all have different incentives, such as sellers who want to charge more for customers who want to pay less, and so on. 

Proceed with caution 

Blockchain providers promise too much security gain, and security teams are not sufficiently trained on the new technology platforms. So the advice is for organisations to move on and act cautiously, “he said. The cautious approach is best here, but perhaps going into production with PoCs (proof-of-concept) is too risky. Today we see a lot of concern about the security of new technologies and platforms, especially in the blockchain area. 

It is best to take a cautious approach to blockchain, but security teams and operations teams need to gain a better understanding of the components that make up the enterprise systems that drive the blockchain. 

This is reflected in a Gartner report in March 2018, which noted an increase in the number of open source blockchain systems in use worldwide. Many of these systems run in parallel to the systems they replace, but they are not really operated in decentralised environments. There is a high rate of experimentation and I have spoken to many companies and this seems to be happening with the majority of them. 

17% of these are in the implementation phase, most are far from operational and only 14% are in production with limited functionality. 

How to secure enterprise blockchain 

This leads to the question: How can a blockchain platform best be made secure for companies? How do you pick up, analyse, test, and analyse mistakes without exposing yourself to a world full of attackers who hope to take advantage of you? 

How can you make a blockchain platform more secure for your business and analyse the security features that the system as a whole is supposed to offer? 

Source out a blockchain security professional who knows how to read secure code and has a reason to write it. Let that professional read the source code, manipulate the live system, make sure things hold, make sure you still can not get around the controls creatively.

I cant stress the importance of cooperation within companies implementing blockchain systems, activated apps must work together to develop a new security model that captures the real security features of the system to ensure that data is protected as it should be. This is really exciting because it gives security experts the opportunity to be on the ground floor of this new technology and help shape the industry.