In the world of increasing cyber-crimes and businesses’ struggle to cope with data security, its regulation and privacy concerns, can blockchain be a great relief? Previously in our posts at TheBlockchainAcademy.com, we have discussed the potential of blockchain in terms of security and privacy of the transactions. In this post, we will see this in a more comprehensive way to reveal its capabilities specifically for cyber and data security proposes.
The blockchain is the distributed file system that keeps files copies of the participants who agree on the changes by mutual consensus. The file consists of blocks, where every block has a cryptographic signature of the last block, making an immutable record. Judd Bagley, the director of communications at the Salt Lake City-based Overstock.co, states that blockchain trading is much secured than any current system. The distributed network that verifies the transactions’ integrity and related accounts balances make even the smartest attack quite impossible. He also said that blockchain technology is fully transparent and transactions cannot be changed. Putting immutability and transparency together, it becomes a dream scenario for the compliance officers, regulators and auditors.
It’s not only stock trading. The blockchain is now hyped as the solution to replace all inefficient information processing set ups, like recording of the property transfers, legal contracts and escrow services. One thing almost all of these systems hold in common is the centralized aspect. In most of the cases, there is just one control system that is hosted on a single computer or a set of computers from one place. There is no failover in the place if something goes wrong, either through computer’s own failure or a hacking attack.
Decentralization of these systems is the solution. This is where blockchain based systems and solutions come into play, because of their highly decentralized and distributed nature. Records are saved on numerous servers and computers around the world, eliminating the central point of failure. A similar technique can be taken when it is about highly complex systems. Using a blockchain oriented communication system for distributing the workload is an example. A diverse form of cyber security would integrate a consensus process for these control systems. Getting the consensus would need control of the network by more than 50 percent, which would almost be impossible to achieve by the hackers. Distribution and decentralization are vital elements for cyber security solutions development in future.
Blockchain technology is indeed able to provide us with the kind of all in one cyber security solution. Rather than looking for encrypting data at the initial point, or making sure security at the final point, the blockchains give end-to-end security including transaction security, protection against negligent or malicious insiders, communication infrastructure safety and server failures etc. Security and privacy are vital to blockchains, which is literally what they were designed to achieve, instead of after-the-fact add ons.
There’s something going beyond safe recordkeeping, however. Digital assets are able to be controlled just like Bitcoins (which are, digital assets themselves, after all), so digital rights administration might well wind up with an entire new look and novel capabilities (such as easy transference of ownership of music collection – like reselling stuff you purchased through iTunes).
The future of the cyber and data security, whether or not is based on blockchains as an important tool must embrace the holistic safety philosophy that is their gist. When we develop a communication system first, and then the security system or a transaction mechanism first, and then the security system, we are actually accepting the thought that these systems should be developed with zero security to start with.
I think that there is going to be direct applications of the blockchain to the security space, apart from immutable records. Though no killer blockchain security app is determined yet; however, the non-fungible developments of the bitcoin will be interesting to watch in future from a cyber and data security perspective.