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- 1 Blockchains have the most secured data, Bitcoin is never hacked.
- 2 Security control specifics are-secure communication, privacy of data, access and security management, key management
The Blockchain is becoming an essential part of the financial sector. Encryption is the reason behind its security. The transaction records are linked with the previous records on a distributed ledger. It means the new block of information is joined with prior blocks. This makes it nearly impossible for the hacker to hack it. The hacker will have to change the whole chain. Nobody can temper the data as they are interconnected.
Blockchain Adjacent Processes Can Be Hacked
To provide more clarity on this, the experts say that the blockchain cannot be hacked but blockchain related processes can be hacked. Like, the transactions made through blockchain can be exploited. Similarly, blockchain assets can be stolen.
There are two types of blockchain: public blockchain and private blockchain. Public blockchains permit anyone to join and remain anonymous. Whereas Private blockchain requires identity to confirm the privileges and can allow the known organizations to join. Fraudsters may attack using phishing attacks, routing attacks, sybil attacks, 51% attacks.
Data shows that the blockchain hacks that have happened in recent years on centralized exchanges. The hackers can get access to the digital assets through an exchange network or platform. For example, Bitcoin is decentralized, means no one can govern and so no one can hack but once we put the asset in exchange the place can be uncovered to hackers.
Revealed by many, verified ownership models is another way to hack the blockchains. In a given blockchain, the integrity of transactions is supported by the community of owners. If one owner gets control of more than 50%, then all sorts of things can be done.
This is challenging in reality as the attacker needs a lot of time even after taking command on over half the nodes. The other form of attack known as sybil attack where people create their fake identities but still they can’t fulfill the 51% holding blockchain strategy.
The new changes like the smart contract makes blockchain even more secure. Smart contracts help to put data and code executions on the blockchain. It has become more and more popular these days. Blockchain can not be hacked but the smart contracts can be exploited and if it is placed on blockchain then it is supposed to hack the blockchain.
The human aspect cannot be neglected. Better understand it as social engineering. If anyone uses the public WiFi and sends the crypto keys over that network then someone may steal your crypto then this is also not a blockchain hack.
So, whenever hearing about blockchain hacking, be aware that it is not a blockchain hack but it is related to the ways we are dealing with the blockchains. Blockchain itself is very resistant. Blockchains are very difficult to hack and so it is less susceptible to cyber attacks. Hence, stolen keys and code exploitation are the two very basic reasons for blockchain hacking.
For more security control, specifics are-secure communication, privacy of data, access and security management, key management. These are some stated security measures.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
