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What makes Blockchain Secure??

The main purpose of using blockchain technology is to let people share/store their important data in a safe, tamper-proof way. At this point of time, we have seen or heard so many news/conspiracies about how technological innovations are messing up with our privacy and important data. Facebook, Google, IOT devices, cloud services, all these tech giants are using our data to make them profit. Which is why blockchain stores data using innovative algorithm and sophisticated math that are extremely difficult for attackers to manipulate. But, even the best designed security system like blockchains were designed by human. We can assume that the chances of a blockchain getting manipulated or tampered are extremely low but are never zero.

To understand the concept clearly, let’s take Bitcoin blockchain as an example here. In Bitcoin’s blockchain, the shared data is the history of every possible Bitcoin transaction ever made: an accounting ledger. Those ledgers are stored in multiple copies across many computers in the network, which are known as “nodes”. Whenever someone submits a transaction made to the ledger, the nodes check to make sure the transaction is valid or not. A subset of nodes will then compete to package valid transactions into “blocks” and then add them to a chain of previous blocks. Where do these nodes come from? It leads to another main component of blockchain, Miners. Miners are the owners of these nodes. Miners who successfully add new blocks to the chain earn bitcoins as a reward.

We keep hearing that Blockchain system are tamperproof, but what makes this system theoretically tamperproof is two things: First, a consensus protocol and second, a cryptographic fingerprint unique to each block, the process by which the nodes in the network agree on a shared history.

The fingerprint, which is also called a hash, requires a lot of computational power and time to generate initially. Therefore, it serves as a proof that the miner used their powerful computers to find a block and add it to the blockchain in order to get rewards, which brings us to “proof-of-work” protocol. Not only that, it also serves as a seal for the system. Since altering a block would require generating a new hash. Verifying, whether the hash matches its block, and once the nodes have done so they update their respective copies of the blockchain with the new block which is knows as consensus protocol.

Another security element in the Blockchain technology is hash. The hashes also serve as the links in the blockchain, meaning: each block includes the previous block’s unique hash. Therefore, if an attacker tries to hack the system or tries to change an entry in the ledger, they must calculate a new hash not only for the block it interfered with but also for every other block in the chain. Also, you must do it faster before the other nodes can add new blocks in the chain. Therefore, unless you have a super powerful computer than the rest of the nodes in the chain combined, it is very unlikely to defect those blocks.  Any nodes that you add in the blockchain will conflict with the existing ones, and the other nodes will automatically reject any such alterations. This is what makes the Blockchain system tamper-proof or “immutable”.

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Roshan
Blockchain analyst
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