According to statistics released in 2015, cash payments still account for the most significant chunk of transactions with 42 % of all 2015 purchases. Nevertheless, digital sales are gradually making headlines. The estimate further that by 2014, over 850,000 bitcoins had been hacked. Currently, the bitcoins would be worth 8.5 billion dollars, so is bitcoin secure or better yet is blockchain technology secure?
What is Blockchain technology?
Blockchain technology typically refers to the translucent, trustless, openly accessible ledger that allows for the secure transfer of ownership of units of value using known key encryption and proof of work methods. The larger the network grows, the more increasingly decentralized it becomes, thus the more secure.
How durable and secure is blockchain technology?
The blockchain is considered one of the most reliable and tamperproof technologies on the market today.
Why is that?
By storing blocks of information that are identical across its network, the blockchain cannot:
- No single entity will ever be able to control it
- There is not one single point of failure in the blockchain.
Cryptographic fingerprint or harsh technology takes plenty of time and energy to add a block to the blockchain. Once it is attached to the growing blockchain, the user receives a bitcoin as a reward. This acts as a seal of approval because if the user decides to change the block, then a new harsh would be generated.
After a block is added, the chain verifies whether that hash matches the block. Once it has been confirmed, the blockchain is updated upon the inclusion of the new block. This is what is usually called the consensus protocol.
The last security check involves the block containing a hash from the previous block.
What does this mean?
If you want to alter the ledger’s entry, then you need to consider calculating a hash for both the block that it is in and its subsequent block. It is noteworthy though that you have to be time sensitive because other nodes are still trying to add new blocks to the growing blockchain.
Consensus protocol means that Blockchain lives in that environment constantly and automatically checks in with itself every ten minutes. A kind of self-auditing ecosystem of a digital value, the network adapts with every transaction that occurs in ten-minute interludes. Each combination of these transactions is referred to as a “block”.
Two major characteristics result from this:
- Transparency data is inserted within the system as a whole, by definition it is public.
- It cannot be harmed changing any unit of data on the blockchain would mean using a tremendous amount of computing capability to override the whole network.
In theory, it js possible. In practice, it’s unlikely to ever occur. Taking command of the operation to seize Bitcoins, for instance, would also destroy their value.
Loopholes within the blockchain
There is a theoretical chance that you can take advantage of the blockchain, though the practical bit of it will need more than just theory. It is everyone’s mindset that cryptos are secure, but it is easy to put them together.
According to MIT Technology Review, corrupting the blockchain is somewhat harder, but it can be done. It gets juicier when you learn that you can take advantage of these loopholes even with half the power as other bitcoin miners. The puzzle to this lies with one miner fooling other nodes into searching for hashes on completed blocks.
For transactions to be approved, nodes must remain in constant communication. A hacker can deceive one node into believing it has the right data which is coming from other nodes, but in reality, it has fake data. This will cause the node to waste time approving wrong transactions which give the hacker plenty of time to make bitcoins.
Is the blockchain still secure? Well, it is a matter of ‘when’ and not ‘if’. No matter how tamperproof or incorruptible the blockchain is, it can still be hacked. The loopholes appear where the system tries to convert the digital information to the real world.
Will it get hacked?
Someone will try. Let’s hope that blockchain technologists have worked ahead of the loopholes and come up with a genuinely incorruptible chain when that time comes.
—Timothy Bank Jr., Crypto writer and enthusiast