However, this does not mean that blockchain is not vulnerable to cyber attacks and security fraud. Those with malicious intent can exploit blockchain vulnerabilities for their own benefit. Many such examples of blockchain attacks make headlines from time to time. Here are some notable events that exposed the most troublesome aspects of blockchain.
While blockchain technology creates a tamper-proof ledger of transactions, blockchain networks are not immune to cyberattacks and fraud. Known vulnerabilities in blockchain infrastructure can be manipulated by those with malicious intent, leading to various hacks and scams over the years.
The benefits of blockchain technology
Blockchain is a particularly promising revolutionary technology as it helps reduce security risks, eliminate fraud and create transparency on an unprecedented scale. Originally associated with cryptocurrencies and non-fungible tokens (NFTs) in the 2010s, blockchain technology has evolved into a governance solution for all types of industries worldwide. With blockchain technology, you can bring transparency to the food supply chain, secure healthcare data, innovate the game, and completely change the way we approach data and ownership. Blockchain technology (also known as distributed ledger technology, or DLT) allows cryptocurrencies (such as Bitcoin) and other digital information to be freely transferred from one person to another without the involvement of third parties. Using blockchain technology, multiple nodes in the network simultaneously verify transactions. Anyone with a computer can join the network and participate in the transaction verification process. Multiple devices approve the transaction, which is stored as a block of code on multiple devices. Each subsequent transaction is added to the chain (hence the blockchain) to preserve history in the DLT (hence the distributed ledger), virtually eliminating the possibility of hacking. This method of secure data exchange without the use of third parties is what makes blockchain technology so attractive. Blockchain can be used for other transactions besides financial transactions. Despite its safe and transparent properties, the technique is general enough to be applied across disciplines. Various industries use blockchain technology. These include energy, logistics, education and more.
Blockchain is a viable technology that can improve systems for sharing and storing health data due to its decentralization, immutability, transparency and traceability. However, many healthcare organizations are reluctant to adopt blockchain technology due to threats such as security and authorization concerns, interoperability issues, and lack of technical skills related to blockchain technology.
The risks of blockchain technology
While the benefits are obvious, this emerging technology can pose myriad risks. As this technology continues to mature, the understanding of blockchain and the risks involved may change and evolve. Therefore, all organizations must continue to monitor the development of this technology and its application in various use cases.
Even established blockchain startups face blockchain security issues. In addition, many unnecessary risks continue to emerge in the blockchain security field, raising an outstanding question: "Is the blockchain really secure?". There is great doubt about the security of the blockchain. The following discussion aims to provide a detailed overview of various issues related to blockchain security.
By Roger K. Olsson