Updated April 8, 2023
Introduction to Is Blockchain Safe?
The blockchain is changing the way business is carried these days. It allows consumers to remove the middlemen in all essential services, reducing costs and also boosts efficiency. But using blockchain has a question raised as to do these technologies offer trust and privacy, and do they ensure private and tamper-free records? To understand the difference, it is important to get the difference between public and private blockchain. Bitcoin is an example of a public blockchain which offers anyone using it to read and write. On the other hand, the private blockchain applications comprise a different range of markets in which varied parties wish to contribute. So when using blockchains, a question arises that is blockchain safe.
What about Security and Privacy?
- Due to the public key infrastructure, blockchain ensures confidentiality. i.e. blockchain technology is safe. It protects against malicious attempts to make changes in data and also maintains the size of the ledger. To answer this, we can say that security starts with network architecture. The network is the first decision to make safe when private blockchain is coming into consideration. To get a consensus of blockchain on their ledger, the list of transactions is made through an announcement, and a communication medium is needed to write or endorse a new transaction.
- The communication that takes place is between two nodes which will have a copy of the ledger and will also inform the other nodes about this new information. People who manage private blockchains have the authority to work on a node and on linked nodes. A node which has many links will get information faster. A private blockchain with many commodities may award more central positions in the network and develop trading partners. It may provide new nodes to maintain a link to one of these central nodes as a safety measure and also behave as expected.
Whether Private Blockchain is more Safe and Secure than the Public One?
- The main purpose of having a private blockchain built is to preserve safety and security in a severely misguided one. It is true that a private blockchain enables the user to screen or filtering of participants while the public blockchain is easily accessible to all people. Due to this public exposure, public blockchain is immune to hacks.
- For example, Bitcoin is an original public blockchain that stood relentlessly for years towards hacking. It grew more resilient with every hack and always withstood. This removes the misconception and proves that public blockchain is considerably Safe and superior to that of the private blockchain.
Consensus Protocols and Access Permissions in the Public and Private Blockchain
- The consensus that is taken is specifically taken to take the time. Transactions that take place are usually taken as fully confirmed only when the time span is about one or two hours. Once this is the point is reached where the time is adequate and deep enough in a ledger that introduces an opposing account of the ledger, called a fork which would be computationally exclusive. This obstacle is both susceptible to the system, and it seems to establish or lose that status which is an important stoppage to use the bitcoin-related system for fast-paced transactions such as monetary trading.
- When it comes to a private blockchain, operators are the ones who decide the definite nodes which will carry the verification process, and only these trusted parties will be accountable and authorized to communicate newly confirmed transactions to the rest of the network. Therefore, the accountability for secure authentication and admission to these nodes and for whom to augment the set of trusted parties is with the blockchain system operator and is a safe choice that he does blockchain.
- Security comes with privacy. To get over with data privacy and safety issues, the blockchain operator can store the personal data and the reference to this data with the hashing technique. This is a one-way transformation of data to an unreadable piece of information. Storing this data off the chain means this personal data needs to be held by the user, or a traditional database should be used. The documents that can be stored off-chain include documents like knowing your customer documents like scanned driver’s license or passport, etc., which will not be updated frequently and can be stored as a standalone database and application systems. By storing data off-chain user reduces transparency and immutability.
- But it also increases the risk of data being lost or stolen which is a danger to all personal information, and it may spread across other networks. A solution for this is a unique identity. This can be called a digital concept which will control personal information, and also controls can be defined with whom this is to be shared. As blockchain has become a component of businesses and institutions, it is important to understand the laws and have designs created which will maximize the synergy and balance regulation and data privacy.
Potential of Blockchain
- As a result of this booming technology, it has been successfully implemented by a few banks. The blockchain is considered to be irreversible, and they consist of encrypted data blocks, which can prove to be helpful to even fight cybercrimes. A hacker, when attempts to change data, will be marked and will be known to the administrator immediately. Blockchain has indeed proven to be safe and secure, and hence applications that used blockchain include cybersecurity companies and even some governments signing up for the same.
- To summarize, blockchain technology can emerge out to be safe, robust, secure, trustworthy and private. The security is ensured by its solid architecture and the secure design that it implements. It also has some very effective work policies which double-check the security. Blockchain clearly has the potential to outweigh all risks as long as it is implemented and executed properly. With all-new technologies, the new digital products must always be designed with all regulations, cybersecurity and keeping data privacy in mind. This is in a way integrated into blockchain to make safe technology.
This has been a guide to Is Blockchain Safe? Here we have discussed how secure blockchain is with its security, private and public blockchain, and potential of blockchain, etc. You may also look at the following articles to learn more –