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Blockchain is the digital ledger of economic transactions that helps not only with financial transactions but anything that has value. Today, one of the biggest assets that a company protects, is data. This is the reason why organizations need to know about information Security, seeing as there is a need to make sure that the teams are trained and know what to do in case there is a security threat.
One of the biggest concerns that revolve around digital transfer is money as well as sensitive information, but blockchain makes an attempt to remove these concerns.
Before we move on to the security threats, it is important to actually know how blockchain works. It basically allows data to be transferred within a distributed system that runs and compares transactions in real time. Since there isn’t only one machine involved in this, the only way a hacker can make a false transaction is if they can control more than half the sources. This means that the more devices there are, the stronger is your system.
Some of the reasons why blockchain is used include:
Unfortunately, every side has two coins, which means that there are some security threats involved with blockchain. For starters, people that primarily have an offline business will be at a disadvantage because people that have an online business will be able to establish better customer bases and well as business models. Other than this, every online technology comes with digital breakthroughs that can cause disruption of business. In order to overcome these issues, a lot of companies are investing in cyber security training.
There are certain features that make blockchain DLT resistant, but don’t make it completely immune. In fact, in case you did not know there are a number of have a number of issues that centralized data bases don’t. Blockchain has security risks that need to be recognized and worked upon. Let’s have a look at some of the threats involved:
Endpoint is the space where blockchains and humans meet. They are basically computers that businesses and individuals use to get access to blockchain services. The providers can be financial institutes or any industry, the process is the same for everyone, it begins with information inputted into computer and information being outputted into computer.
In order to access a blockchain, one needs a public as well as private key. If you have the right keys, no one will be able to access your data, however if the hacker gets hold of them, all your data is theirs.
Some of the ways in which this can be avoided include:
One important thing to consider is what happens at full scale? Till today, no major issues have been reported when it comes to expansion of blockchain, however, according to the Financial Stability Oversight Council (FSOC) there may be some loopholes. Since blockchain is expanding, it may be approaching unknown territory that may affect its security. The best way to avoid this is to train the team to learn about well-designed smart contracts, as it can prevent collusions.
A ledger is of no use if we can’t move information into and out of it. Due to DLT, it is expected that 3rd party development will take place in the following areas:
It is important to train the team to be on a lookout for weak security in the systems. The threat is much more when the product includes smart contacts.
When it comes to untested code, it is important to know about The DAO attack. DAO is Decentralized Autonomous Organization that is built for executing code. It was built in 2016 and shortly afterwards it was hacked. The hacker knew that the code was designed to allow a split as well as transfer of tokens between accounts. In order to avoid this problem, the team can be trained in the following ways:
Lack of regulations is a major concern when it comes to blockchain. Since there is a lack of protocol, it means that blockchain developers can’t learn from the mistakes of other. Training your team to overcome this problem is not easy. Until a solution is found to overcome the lack of regulations and government interference, organizations will have to train their employees on their own. Here are some of the recommendations.
Overall, despite Blockchain holding great promise for enterprises; understanding the risk factors is of utmost importance. Fortunately, information security training can be utilized as a safety net to prevent blockchain-based fallout, and ensure successful utilization.