Security of the Blockchain

A blockchain, as the name implies, is a chain of digital “blocks” that contain records of transactions. Each block is connected to all the blocks before and after it. This makes it difficult to tamper with a single record because a hacker would need to change the block containing that record as well as those linked to it to avoid detection. This alone might not seem like much of a deterrence, but blockchain has some other inherent characteristics that provide additional means of security.

The records on a blockchain are secured through cryptography. Network participants have their own private keys that are assigned to the transactions they make and act as a personal digital signature. If a record is altered, the signature will become invalid and the peer network will know right away that something has happened. Early notification is crucial to preventing further damage.

Unfortunately for those ambitious hackers, blockchains are decentralized and distributed across peer-to-peer networks that are continually updated and kept in sync. Because they aren’t contained in a central location, blockchains don’t have a single point of failure and cannot be changed from a single computer. It would require massive amounts of computing power to access every instance (or at least a 51 percent majority) of a certain blockchain and alter them all at the same time. There has been some debate about whether this means smaller blockchain networks could be vulnerable to attack, but a verdict hasn’t been reached. In any case, the bigger your network is, the more tamper-resistant your blockchain will be. This is why we have chosen to build on the Ethereum Blockchain for our ICO, though we do have plans to develop our own blockchain in the near future.