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Blockchain Security Vulnerabilities

 

Prosper Moses

University of Maryland Global Campus

WRTG 391: Advanced Research Writing

Professor Nihal Sadek

July 12, 2022

 

 

 

 

 

 

 

 

 

 

Blockchain Security Vulnerabilities

A blockchain is a decentralized database that tracks an ever-growing list of records, known as blocks. Each block contains a timestamp and a link to the prior block in a chain. Blockchain technology was first proposed in 1991, but it did not gain widespread attention until 2009, when it was used as the underlying platform for the digital currency, Bitcoin (Singh et al., 2021). Since then, blockchain has been touted as a transformative technology with the potential to revolutionize many industries. However, blockchain is not without its challenges. One of the biggest challenges facing blockchain is security. Because each block in a blockchain is linked to all previous blocks, a single point of failure can jeopardize the entire system. This makes blockchain systems particularly vulnerable to hacking attacks. In addition, because blockchain systems are often decentralized, it can be difficult to identify and track down individuals who may be responsible for security breaches (Kushwaha et al., 2020).

Despite these challenges, many experts believe that blockchain has the potential to become one of the most important technologies of the 21st century. The need for secure, decentralized platforms will only grow as the world becomes increasingly digitized. With its unique combination of security and transparency, blockchain may be up to the challenge. This essay attempts to address the issue of blockchain vulnerabilities by synthesizing six resources on blockchain security vulnerabilities, what these sources discuss in common, and their differentiating aspects.

Blockchain Vulnerabilities Synthesis.

Blockchain has been described as a “disruptive technology” because it has the potential to change the way individuals and organizations do business and interact with one another. At its core, a blockchain is a distributed database. This means that instead of having a single central authority, like a bank or government overseeing the database, it is distributed across a computer network. This network can be public, like the Bitcoin network, or it can be private, like a company’s internal network.

The authors agree that blockchain is a disruptive technology with the potential to change the way business is done. However, they also identify some challenges that need to be addressed before blockchain can reach its full potential (Chen et al., 2020; Harshavardhan et al., 2018; Kim et al., 2019; Kushwaha et al., 2022; Saini et al., 2019; Singh et al., 2021).

One of the biggest challenges facing blockchain is security. Kim et al. (2019) note that blockchain applications are often associated with high-security risks. This is because a blockchain is a distributed database, meaning there is no single point of failure. The entire system can be compromised if one computer in the network is hacked. This vulnerability was highlighted in 2014 when a hacker could exploit a flaw in the Bitcoin blockchain to create 184 billion Bitcoins out of thin air. The currency’s value plummeted, and it took months for the network to recover.

Similarly, Singh et al. (2021) identify security as one of blockchain’s biggest challenges. They note that blockchain systems are often decentralized, which makes it difficult to track down individuals who may be responsible for security breaches. In addition, they point out that blockchain systems are often built on trustless networks, which means that there is no central authority that can be held accountable for security breaches.

This decentralization can also make it difficult to resolve disputes. For example, if two parties disagree about the contents of a transaction, no central authority can decide who is right and who is wrong. This can lead to lengthy and expensive court cases, as was seen in the case of the now-defunct cryptocurrency exchange Mt. Gox (Kushwaha et al., 2020).

While all the articles identify security as a challenge facing blockchain, some of them differ in their assessment of the severity of this challenge. Kushwaha et al. (2020) and Chen et al. (2020) take a more optimistic view, arguing that while security is a challenge, it is not insurmountable. They point to the fact that blockchain systems are constantly evolving and becoming more secure. Additionally, they argue that the security challenges facing blockchain are not unique to this technology and can be found in other distributed systems as well.

The articles also differ in their discussion of other challenges facing blockchain. For example, Singh et al. (2021) highlight the scalability problem as one of blockchain’s most significant challenges. They note that the network can become overloaded as more people use blockchain applications, and transaction times can slow down. This is a major problem for cryptocurrencies like Bitcoin, which are designed to be used by millions worldwide.

Kushwaha et al. (2020), on the other hand, believe that the scalability problem is not as significant as some people make it out to be. They argue that while blockchain systems may not handle the same amount of transactions as traditional centralized systems, they are constantly evolving and becoming more efficient. Harshavardhan et al. (2018) also downplay the importance of the scalability problem, arguing that it is not a major concern for private blockchain networks. Their argument is also that these networks are not designed to handle large numbers of transactions, and so the scalability problem is not as significant. To back up their argument, Harshavardhan et al. (2018) give examples in cloud computing cases such as the IBM Food Trust network. The network is a private blockchain network designed to track food items throughout the supply chain, and it has been successful in doing so. Hence scalability is not always a problem for blockchains. Another example that they give is the case of the R3 Corda platform. The platform is a private blockchain network that is used by a consortium of over 200 banks for financial transactions. The platform has successfully processed over a million transactions. Hence, it can be seen that the scalability problem is not as significant as some people make it out to be and that private blockchain networks can handle large numbers of transactions without any issues.

Some people have also questioned the security of blockchain systems. Again, this is mostly because these systems are decentralized, and there is no central authority that can be held accountable in case of a security breach. However, as Harshavardhan et al. (2018) point out, this is not necessarily a bad thing. They argue that the decentralized nature of blockchain systems makes them more secure, as there is no single point of failure. In other words, if one node in the network is compromised, the rest of the network is still secure. This is because each node in the network has a copy of the entire blockchain, and so it would be very difficult for a hacker to change the blockchain without the consensus of the other nodes. Harshavardhan et al. (2018) also argue that using cryptography in blockchain systems makes them very secure. They claim that the hashing algorithms used in these systems are very difficult to break, so it would be very difficult for a hacker to compromise the security of a blockchain system. Per their argument, blockchain security vulnerabilities can mainly be attributed to human error, such as in the case of the DAO hack, and not to the technology itself.

Different Methods for Improving Blockchain Security.

The articles also address different methods for improving blockchain security. Kim et al. (2019) recommend that companies use multiple security layers, such as encryption and authentication, to protect their blockchain systems. They also suggest that companies should conduct regular audits of their systems to ensure that they are secure.

Singh et al. (2021) and Saini et al. (2019) recommend using digital signatures to improve security. Digital signatures are a type of cryptography that allows individuals to sign documents electronically. This can be used to verify the identity of the transaction’s sender and ensure that the transaction has not been tampered with. Saini et al. (2019) also recommend the use of access control mechanisms to improve security. Access control mechanisms are used to restrict access to sensitive data. For example, a company might use an access control mechanism to allow only certain individuals to view or modify customer data.

Chen et al. (2020) recommend using permissioned blockchain systems to improve security. Permissioned blockchain systems are private networks requiring individuals to be authorized by the network administrator before accessing the network. This can help to improve security by preventing unauthorized individuals from accessing the network.

Kushwaha et al. (2020) recommend using quantum-resistant algorithms to improve security. Quantum-resistant algorithms are mathematical algorithms that are designed to be resistant to attacks from quantum computers. Quantum computers are a type of computer that can perform certain operations, such as factorization, much faster than traditional computers.

Harshavardhan et al. (2018), on the other hand, suggest that one way to improve security is to use hybrid blockchains, which combine features of both public and private blockchains. They argue that this would allow for the best of both worlds, as hybrid blockchains would be more secure than public blockchains but would still allow for transparency and accountability. They also add that hybrid blockchains would be more scalable than private blockchains.

Conclusion

In conclusion, the articles discuss various security vulnerabilities in blockchain systems, and they also address different methods for improving security. Some of the methods discussed include using multiple layers of security, regular audits, digital signatures, access control mechanisms, permissioned blockchain systems, quantum-resistant algorithms, and hybrid blockchains. The articles provide a good overview of the security issues associated with blockchain technology and the different methods that can be used to improve security.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

Chen, H., Pendleton, M., Njilla, L., & Xu, S. (2020). A survey on Ethereum systems security: Vulnerabilities, attacks, and defenses. ACM Computing Surveys (CSUR), 53(3), 1-43. https://doi.org/10.1145/3391195

Harshavardhan, A., Vijayakumar, T., & Mugunthan, S. R. (2018, August). Blockchain technology in cloud computing to overcome security vulnerabilities. In 2018 2nd International Conference on I-SMAC (IoT in Social, Mobile, Analytics and Cloud) (I-SMAC) I-SMAC (IoT in Social, Mobile, Analytics and Cloud) (I-SMAC), 2018 2nd International Conference on (pp. 408-414). IEEE. https://doi.org/10.1109/I-SMAC.2018.8653690

Kim, S. K., Kim, U. M., & Huh, J. H. (2019). A study on improvement of blockchain application to overcome vulnerability of IoT multiplatform security. Energies, 12(3), 402. https://doi.org/10.3390/en12030402

Kushwaha, S. S., Joshi, S., Singh, D., Kaur, M., & Lee, H. N. (2022). Systematic review of security vulnerabilities in Ethereum blockchain smart contract. IEEE Access. https://doi.org/10.1109/ACCESS.2021.3140091

Saini, H., Bhushan, B., Arora, A., & Kaur, A. (2019, July). Security vulnerabilities in Information communication technology: Blockchain to the rescue (A survey on Blockchain Technology). In 2019 2nd International Conference on Intelligent Computing, Instrumentation and Control Technologies (ICICICT) (Vol. 1, pp. 1680-1684). IEEE. https://doi.org/10.1109/ICICICT46008.2019.8993229

Singh, S., Hosen, A. S., & Yoon, B. (2021). Blockchain security attacks, challenges, and solutions for the future distributed IoT network. IEEE Access, 9, 13938-13959. https://doi.org/10.1109/ACCESS.2021.3051602